MIGA has issued a guarantee of $4.1 million to SGS SA of Switzerland covering its equity investment in Enterprise Publique Economique de Contrôle Technique Automobile (COTA) in Algeria. The coverage is for a period of up to five years against the risks of transfer restriction, expropriation, and war and civil disturbance.
The project involves the privatization of COTA, a public company established in 2001 by Algeria’s Ministry of Transport. COTA’s role is to provide mandatory vehicle inspection throughout Algeria. SGS acquired a majority of COTA in 2007 and is introducing international vehicle safety standards and state-of-the-art inspection systems.
Efficient and effective vehicle inspection services are a critical element of road safety. Annually, road crashes kill an estimated 1.2 million people worldwide and injure 50 million more, and tend to disproportionately affect the poor. Vehicle inspection services are an integral part of the World Bank’s transport business strategy.
The World Bank Group’s country assistance strategy for Algeria commits to supporting government reform efforts that include fostering private participation in transport and other economic sectors. Within the next five years, the project is expected to generate approximately 50 new local jobs and $1.3 million in revenue for the government. This project was underwritten through MIGA’s Small Investment Program.
