Annual Reports

During the fiscal year ending June 30, 2006, MIGA issued $1.3 billion in investment guarantees (insurance) for 41 projects in developing countries. The results bring total coverage issued by the agency to $16 billion. Many of the projects focused on MIGA's priorities of supporting investment in “frontier markets” (high-risk/low-income), in conflict-affected and IDA-eligible (the world's poorest) countries, and investments between developing countries.  The Highlights section includes messages from President Paul Wolfowitz and Executive Vice President Yukiko Omura

During fiscal year 2005, MIGA’s Board of Directors reviewed and concurred with investment guarantees for 37 projects. The Board also oversaw and reviewed MIGA’s budgeting and planning process for the upcoming fiscal year. The Board approved MIGA’s FY05- 08 strategy document (see message from the Executive Vice President) and, along with the Council of Governors, endorsed a five-year review of the agency’s activities during FY00-04. A new provisioning methodology for the agency also received Board approval. In addition, during the 2004 Annual Meetings, the Council of Governors approved a mechanism to achieve voting parity between Category 1 and Category 2 countries. Last, the Board reviewed the 2004 Review of Development Effectiveness in MIGA and approved the 2005 Annual Report, both prepared by the Operations Evaluation Unit, which independently evaluates MIGA’s activities.

During fiscal 2004, MIGA’s Board of Directors concurred with or approved 39 individual investment guarantee operations. It also oversaw and reviewed MIGA’s budget and planning process. In addition, the Board took note of a report establishing MIGA’s Small Investment Program (SIP) and approved a waiver of the requirement to circulate to the Board reports of guarantees issued under the SIP prior to their approval by the President. The Board approved MIGA’s contribution to the creation of a joint guarantee facility— involving IDA, the Agence Française de Développement and MIGA. The facility supports investments in West African states that are members of the Banque OuestAfricaine de Développement (BOAD). In addition, the Board approved a waiver of the requirement to circulate to the Board reports of guarantees issued by the facility prior to their approval by the President. The Board approved and submitted to the Council of Governors a proposal to achieve voting power parity between MIGA’s Category One (developed) and Category Two (developing) member countries.

During fiscal year 2003, MIGA Board of Directors concurred with 43 individual investment guarantee operations. The Board also oversaw and reviewed MIGA’s strategy and policy planning process. As part of ongoing efforts to harmonize sectoral strategies for the World Bank Group, the Board discussed and endorsed the revised forest strategy. Through CODE, directors also had the opportunity to discuss the World Bank Group strategy in private sector development in the electric power sector, which was a joint review by the Operations Evaluation Department of the World Bank, the Operations Evaluation Group of the IFC and MIGA’s Operations Evaluation Unit.

The past fiscal year has not been an easy one. From the September 11th tragedy to the ongoing economic turmoil in Argentina, from the health crises engulfing Africa to political upheaval in Afghanistan and the Middle East, we have not seen a period in recent history marked by such global uncertainty. And we know from experience that the poor will suffer disproportionately from the current state of world affairs. Against this backdrop, The World Bank Group institutions continue to stand as agents that support economic growth and alleviate poverty in the developing world.

The private sector-focused arms of the Bank Group play a vital role in catalyzing private investment, which is so critical for financing sustained economic growth over the long-term. MIGA’s mandate directly addresses this development imperative, helping developing countries attract and enhance inflows of productive capital.

The immediate impact of the past year’s events on MIGA’s guarantee program was a reduction in coverage issued compared with the previous year’s levels, as foreign investment into developing countries has decreased. Despite this, the Agency has produced solid results in its priority areas of supporting investment: into subSaharan Africa, in particular; into the world’s poorest countries, in general; between developing countries; and in support of complex infrastructure projects. The events of the past fiscal year have also underscored MIGA’s unique role as a counter-cyclical provider of investment insurance, by stepping in at times when other insurers are being much more selective about the projects and countries for which they will provide coverage, and by providing investors and lenders with the confidence they need to make long-term commitments in developing countries

During fiscal 2000, MIGA undertook a major review of its activities, as required by its Convention. The review details the agency’s growth since the last review in 1994 and maps future directions. In this exercise I was most grateful for the wise counsel of many leaders and experts. Based on an extensive market survey, the review reinforced four main areas of focus established last year: developmental effectiveness, financial soundness, client orientation, and partnerships and allowed MIGA to identify as “priority areas” the types of investment that are generally not well supported by other insurers, namely: investments in IDA-eligible countries, investments in Africa, South-South investments, and small- and medium-sized enterprises. Performance in fiscal 2000 was in line with these directions, and MIGA intends to continue to focus on its comparative advantage in guarantees and technical assistance