MIGA has issued a guarantee of $0.6 million to Société Malienne de Promotion Hôtelière (SMPH) for its equity investment in Société Guinéenne de Promotion Hôtelière. The guarantee is for a period of up to ten years, against the risks of transfer restriction, expropriation, and war and civil disturbance.
SMPH has acquired the Hotel 24 Setempro in Bissau, the capital of Guinea Bissau, following a competitively bid privatization. The hotel will be renovated into a four-star business hotel of international standing. The renovation of this centrally-located hotel in the capital city will support Guinea Bissau’s efforts to attract foreign direct investment and to develop its potential as a “nature and adventure” destination for tourists.
The World Bank has supported the privatization of the Hotel 24 Setempro and other state-owned assets under the Private Sector Rehabilitation and Development Project. The sponsor considers MIGA’s role as crucial to the smooth implementation of its investment in Guinea Bissau and their overall development strategy in a time of rapid expansion. SMPH is also renovating a hotel in Burkina Faso with the support of a MIGA guarantee.
The project addresses three of MIGA’s priority areas: an investment in an IDA-eligible country, which is among the world’s poorest; an investment in an African country; and a South-South investment. This is the first guarantee that MIGA has issued in support of an investment in Guinea-Bissau. The project was underwritten through MIGA’s Small Investment Program.