Opportunities for Dutch Investors in Developing Countries

Agreement between MIGA and the Netherlands Increases Opportunities for Dutch Investors in Developing Countries

WASHINGTON, DC, October 4, 2004—The Multilateral Investment Guarantee Agency (MIGA), a member of the World Bank Group, and the Ministry of Finance of the Netherlands signed a Memorandum of Understanding today which is designed to enhance the access of Dutch investors to political risk insurance provided by MIGA, thereby encouraging their continued involvement in projects in developing countries.

The cooperation marks the first time in MIGA’s history that a member state of MIGA decides to reinsure the Agency for projects involving its national companies. MIGA obtains most of its reinsurance from the private insurance market, although it also partners with Export Credit Agencies on a project-by-project basis. The agreement, which was signed by Gerrit Zalm, Minister of the Finance of the Netherlands, and Yukiko Omura, Executive Vice President of MIGA, will provide for a total reinsurance capacity from the Netherlands of up to EUR150 million a year.

“This partnership with a multilateral institution in which we are a shareholder will not only provide an excellent service to Dutch investors at minimum cost to the Dutch tax payer, but will facilitate investments by Dutch companies into projects that carry the World Bank Group’s environmental and developmental seal of approval, and therefore benefit developing countries as well,” Minister of Finance Zalm is quoted as saying. “As a result, the new reinsurance facility will lead to a stronger partnership between the Netherlands and developing countries.”

The initiative for the reinsurance facility was taken when an in-depth national review of the existing Dutch investment insurance schemes by the Netherlands’ Government called for enhancing the country’s cooperation with MIGA.

Dutch investors are involved in a large number of projects guaranteed by MIGA. As of June 30, 2004, the Netherlands was the fourth largest investor country – accounting for some 8.5 percent of MIGA's total outstanding portfolio distribution. Since its inception in 1988, MIGA has provided nearly $1.4 billion dollars in guarantee coverage to Dutch investors. Projects insured have been in the agribusiness, financial, infrastructure, manufacturing, oil and gas, services, and tourism sectors in 25 countries across Sub-Saharan Africa, Asia, Europe and Central Asia, and Latin America.

“This form of cooperation with the Netherlands is truely unique” said MIGA’s Executive Vice President, Yukiko Omura. “It opens the door to much more cooperation with Dutch investors, who are extremely active in developing countries. It also sets an example for other countries on how to maximize value from their shareholding in MIGA. I hope that others will follow.” 
For information 
Washington, DC:
Audrey Liounis,
aliounis@worldbank.org, t. 202-473-1485