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MIGA’s goal is to promote foreign direct investment into developing countries to support economic growth and more.

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Explore different types of political risk insurance guarantees provided to investors and lenders.

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Explore global projects that support economic growth, reduce poverty and improves people’s lives.

Hands husking peas into a basket full of peas

Learn about the progress MIGA is making in its mission to support economic growth, reduce poverty and improve people’s lives.

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About Dropdown Description

World Bank building

MIGA’s goal is to promote foreign direct investment into developing countries to support economic growth and more.

Our Impact Dropdown Description

Hands husking peas into a basket full of peas

Learn about the progress MIGA is making in its mission to support economic growth, reduce poverty and improve people’s lives.

Our Products Dropdown Description

Young woman bending down to tending to her outside chores

Explore different types of political risk insurance guarantees provided to investors and lenders.

Projects Dropdown Descriptions

Hyundai building

Explore global projects that support economic growth, reduce poverty and improves people’s lives.

Brief

Reducing the Risk Profile of Financial Investments

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Lack of long-term local funding has always been a major constraint on growth in developing countries. Local banks normally have access to short-term funding through local deposits, but long-term funds tend to be scarce and international banks are less inclined to take on longer-term risks due to the inherent instabilities in some emerging economies and the need to prudently manage their country limits.

MIGA guarantees are well-suited to reducing the political risks to guaranteed investments and can be used in many ways. For example, a local bank in an emerging market may find it difficult to obtain medium to long-term funding. MIGA may be able to address this concern by providing political risk insurance to a foreign lender that is willing to lend to the local bank at longer tenors with a MIGA guarantee.

MIGA is also classified as a highly-rated multilateral by the Basel Committee on Banking Supervision. This means that a private bank using MIGA insurance to protect against the risk of currency convertibility and transfer restrictions being imposed can now make use of the borrower’s local currency rating for risk-weighting purposes. This recognition also means that when an international bank has obtained MIGA’s coverage for a non-honoring of a sovereign financial obligation, the bank receives very significant capital relief.