Guaranteeing Investments in Manufacturing Projects
As with cross-border investments in many sectors, there are noncommercial risks associated with manufacturing projects in emerging economies. Despite the best intentions and thorough planning, unforeseen events can disrupt a project.
MIGA guarantees are well-suited to mitigate the noncommercial risks associated with manufacturing projects in emerging markets, thereby lowering the cost of capital. They reassure lenders that their investments are protected. They help equity owners over hesitations that may loom large prior to deal signing, particularly for costly investments in countries seen as high-risk. And once a deal is in place, MIGA guarantees backed by the World Bank Group bring companies peace of mind, providing an added measure of security that can stabilize an entire project’s risk profile and reinforce positive relations with host governments.