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

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MIGA Takes Message on the Road to Gulf States

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MIGA Takes Message on the Road to Gulf States:
‘Mobile offices' target foreign direct investment

 

Image removed.

For more on the mobile offices
contact Marcus Williams at
Mwilliams5@worldbank.org

June 28, 2000—The Multilateral Investment Guarantee Agency recently wrapped up a tour of the Gulf region as part of its "mobile office" program, a pioneering effort to spur foreign direct investment into developing countries.

"Mobile offices are an important way to extend MIGA's reach to prospective clients, especially as we do not have many MIGA representatives based in the field," says Moina Varkie, head of the agency's new marketing unit.

Typically, a mobile office operates for one to three weeks, during which a small team visits major cities in a region to share information about the agency's activities.

MIGA insures, or guarantees, investors and lenders against political risks associated with transfer restriction, expropriation, breach of contract, and war and civil disturbance in developing countries. MIGA also provides investment marketing services to help governments strengthen their capacity to attract and retain foreign direct investment, as well as online information services such as IPAnet, a website that helps link potential investors with opportunities in developing countries.

The latest mobile office, launched in May, toured seven cities throughout Saudi Arabia, Bahrain, Kuwait, and the United Arab Emirates, where staff held seminars and one-on-one meetings with potential investors and lenders. Also attending were public sector officials interested in promoting foreign direct investment into their countries. Previous mobile offices have been held in East Africa, South Africa, India, the UK, and Japan.

"The Middle East currently accounts for only a small percentage of MIGA's portfolio," says Varkie. But, she points out, the investment environment is opening up across the region, and "we want to be well-positioned to encourage foreign direct investment as the situation evolves."

Saudi Arabia, for example, has taken steps to create an environment that's more conducive to foreign investors. Joining the MIGA team at the recent mobile office in Riyadh, Prince Abdullah Bin Faisal Bin Turki told investors and government officials that his country would continue to improve its new investment law "to fully service foreign and local investors," according to the Saudi Gazette.

"We are trying to get things needed by the investors done," said the prince, who heads the Saudi Arabian General Investment Authority.

MIGA too has stepped up its work in Saudi Arabia, mainly through its recent collaboration with the World Bank's mining division to help the government generate private sector involvement in its mining sector. Part of that work includes a review of the legal and regulatory environment for private investment, and an outline of strategic options to develop the sector and stimulate private investment flows.

In other work in the region, MIGA has provided war risk coverage to Union Carbide for an investment in a petrochemical facility on Kuwait's east coast. The effort is a joint venture with the national Kuwaiti oil company and is the first of its kind in the country. The project is creating about 100 permanent jobs for Kuwaiti nationals, and several hundred other jobs for nationals from other developing countries.

The evolving investment landscape creates an opportunity not just for investors but also for public and private insurers. "Working with other insurers, including the Inter-Arab Investment Guarantee Corporation, MIGA hopes to generate more foreign direct investment into and from the region," says Varkie.

MIGA was created by the World Bank Group in 1988 to encourage foreign direct investment in developing countries. Since its inception, MIGA has offered over $7 billion in insurance coverage for projects in 75 countries. In fiscal 2000, the agency issued guarantee contracts totaling over $1.5 billion in insurance coverage, and undertook 53 technical assistance activities that benefited over 40 countries.

To find out more about the agency's involvement in investment promotion, visit IPAnet at www.ipanet.net.

 

UPDATED July 30, 2001

 

           

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