MIGA Reports Continued, Strong Interest in its Political Risk Insurance
World Bank Agency Reports $2.8 Billion in New Issuance for Fiscal Year 2013
WASHINGTON, DC, July 1, 2013 — The Multilateral Investment Guarantee Agency (MIGA), the political risk insurance arm of the World Bank Group, announced year-end results today demonstrating sustained growth in support of foreign direct investment (FDI) in its developing member countries. For the fiscal year ending June 30, 2013, the Agency issued a record high of $2.8 billion in new investment guarantees insuring projects that will support economic growth and poverty reduction. Many of the projects will be transformational for the host countries.
At $1.5 billion, representing more than half of new business, the bulk of MIGA’s guarantees issued this year support investments in sub-Saharan Africa. Projects in the region cover a broad swath of sectors, but MIGA’s support to the energy sector is the most significant: a large share of MIGA’s new issuance in the region was for projects that will address the continent’s power deficit, which has a significant impact on competitiveness.
MIGA’s support to post-conflict and fragile countries is noteworthy this year, continuing an important trend. The Agency has tripled its exposure to post-conflict and fragile countries in the past three years. This year, MIGA also launched its Conflict-Affected and Fragile Economies Facility that will use donor contributions together with MIGA guarantees to insure even more investment projects in places affected by conflict.
MIGA continues to see strong demand in the Middle East and North Africa and insured projects in Egypt, Jordan, and Libya. Since the onset of the Arab Spring, MIGA has made a concerted effort to reach out to investors targeting the region to maintain and encourage FDI in this period of transition. MIGA also insured three projects in the West Bank and Gaza through its West Bank and Gaza Investment Guarantee Trust Fund.
The Agency has actively sought to support banks and other financial institutions in Europe and Central Asia as they have been affected by the euro-zone crisis. MIGA guaranteed several projects in the region’s financial sector this year.
MIGA supported investments in the energy and manufacturing sectors in Latin America and Asia this year, in countries such as Nicaragua, Afghanistan, Bangladesh, Pakistan, and Vietnam.
The Agency’s new hubs in Asia and Paris have contributed to the successful fiscal year results.
A number of the projects MIGA guaranteed this year also involved the participation of the World Bank and IFC. As all members of the World Bank Group seek for innovative ways to boost development while harnessing the resources of the private sector, MIGA has increased its product range. MIGA has seen robust uptake in its non-honoring of financial obligations cover, and this year expanded its scope further to include state-owned enterprises.
“We’re very pleased with these achievements—especially as we’re celebrating our 25th anniversary this year,” said MIGA’s Executive Vice President Izumi Kobayashi. “The Agency has evolved and grown since our founding, staying relevant to the market and countries’ needs.”
“On a personal note,” she added, “As I end my appointed tenure at MIGA, I’m proud to have worked for an organization that plays a critical role in helping investors and lenders reach some of the world’s most challenging markets—while having a significant impact on people’s lives.”
MULTILATERAL INVESTMENT GUARANTEE AGENCY
A Member of the World Bank Group
1818 H Street, NW, Washington, DC 20433
Mallory Saleson, MIGA
Tel: +1 202 473-0844
Rebecca Post, MIGA
Tel: +1 202-473-1964
Cara Santos Pianesi