Global Village Telecom Ltda.

MIGA has provided ECI Telecom Ltd. (ECI) of Israel with guarantees totaling $83.5 million to cover its $27 million equity investment in, and $165 million loan investments to, Global Village Telecom Ltda. (GVT) of Brazil. A guarantee was issued to ECI in fiscal 2001 for $20 million, and an additional $10.5 million was insured earlier in fiscal 2002. These coverages were superseded by the final coverage issued in fiscal 2002, for $83.5 million. The coverage is for up to eight years, and is against the risks of transfer restriction, expropriation of funds, and war and civil disturbance. Of the guaranteed amount,$53 million has been reinsured by IFTRIC.

In Brazil, a key development objective is the support of the infrastructure sector through decentralization and increased private participation, as well as projects that will improve the prospects for additional investment and growth. The GVT project focuses on telecommunications infrastructure, and involves the construction and operation of a fixed line telephone network in the central and southern region of Brazil. Once complete, GVT is expected to provide state of the art telecommunication structure and to extend phone service into new areas, such as rural and remote communities. In addition, the project should increase competition in the telecom sector, generate approximately $70 million in tax revenues annually, and provide continuous employment for up to 1,500 Brazilian citizens. GVT expects to source locally for goods and services, generating revenues for Brazilian suppliers and service providers. The company plans to target SMEs for specialized services such as data transmission and internet access.