The Multilateral Investment Guarantee Agency (MIGA) is a member of the World Bank Group. MIGA’s mandate is to promote developmentally sustainable foreign direct investment into its developing member countries. It does this by providing political risk insurance (guarantees) against certain noncommercial risks to cross-border investments, as well as by providing dispute resolution services for guaranteed investments.
MIGA’s non-honoring of financial obligations (NHFO) coverage provides credit enhancement in transactions involving sovereign and sub-sovereign entities, as well as state-owned enterprises (SOEs). The primary beneficiaries that can benefit from this cover are commercial lenders that provide loans to these public sector entities for infrastructure and other productive investments. NHFO protects the lender against losses resulting from a failure to make a payment when due under an unconditional financial payment obligation or guarantee. NHFO does not require the investor to obtain an arbitral award in order to file a claim for compensation with MIGA. View this Brief in French.