WASHINGTON, June 27, 2011 — The Multilateral Investment Guarantee Agency (MIGA), a member of the World Bank Group, announced that it will mobilize $1 billion in insurance capacity for the Middle East and North Africa to retain and encourage foreign direct investment in the region. The agency also said it is stepping up efforts to reach out to investors, lenders, and governments around the world to make it clear that the agency is open for business in the region and to share its global experience of managing political risks.
The need for investments into the Middle East and North Africa that create jobs and opportunity is greater than ever. MIGA’s political risk insurance can be an important risk-mitigation instrument to investors who may be nervous about maintaining existing investments or have plans to invest in the region.
In an effort to ensure that development gains are not lost and to encourage further improvement, MIGA is collaborating with the World Bank, the International Finance Corporation, and other regional partners with the aim of leveraging their collective resources to support inbound FDI. “MIGA’s efforts include discussions with the private sector, regional government agencies, and state-owned enterprises to understand their needs with respect to priority projects,” says Elena Palei, a senior underwriter at MIGA who is currently in the region for discussions in Egypt, Jordan, Morocco, and Tunisia. She notes MIGA’s product flexibility, including the capacity to guarantee projects under Islamic financing structures, which is particularly relevant for financiers in the region.
MIGA Executive Vice President Izumi Kobayashi noted, “Restoring investors’ confidence is critical to the medium- to long-term economic and social development of the Middle East and North Africa. FDI can boost growth and help create much-needed jobs—a particularly acute challenge for the region.”
“Our development mandate obliges us to support investment where it’s most needed and to fill gaps in the market,” she continued. “This is precisely why MIGA is setting aside capacity for the region at this crucial moment.”
About MIGA
MIGA was created in 1988 as a member of the World Bank Group to promote foreign direct investment into emerging economies to support economic growth, reduce poverty, and improve people’s lives. MIGA fulfills this mandate by offering political risk insurance (guarantees) to investors and lenders, covering risks including expropriation, breach of contract, currency transfer restriction, war and civil disturbance, and non-honoring of sovereign financial obligations.
