Below we’ve answered some common questions for those in search of more information about MIGA and how we operate.
MIGA provides political risk guarantees, trade finance guarantees, and credit guarantees for investments into developing countries. MIGA is the home of the World Bank Group Guarantee Platform, which provides guarantee products from the balance sheets of MIGA, IFC, and the World Bank. Click here to see a full list of World Bank Group guarantees.
In general, investors who are citizens of, or entities that are incorporated in, MIGA member countries—other than the country in which the investment is being made (called host country)—are eligible for MIGA guarantees. However, MIGA can insure an investment made by a national of a host country if the funds to be invested come from outside the country and the application for coverage is made jointly by the investor and the host country.
MIGA issues guarantees for periods of up to 15 years, and occasionally, 20 years. The minimum length of a guarantee is three years. In guarantees that cover loans, MIGA usually issues coverage to match the length of such loans.
Yes, if the investor breaches its contractual obligations.
Yes, after the first three years of coverage, or as of the date of notice when the project enterprise is liquidated, declared bankrupt, or placed on receivership, or the guarantee holder has no legal interest in the guaranteed project.
No, MIGA is an insurer, not a lender.
No, MIGA covers only equity interests, loans related to an investment project (shareholder and non-shareholder loans), and certain types of transactions in which the investor's remuneration depends on the revenues or production of the investment project.
Yes, prior to consideration by MIGA's Board of Directors, MIGA discloses on its website a "Summary of Proposed Guarantee" that includes the name of the investor, the host country, a brief project description, the risks covered, and the amounts to be insured. Proprietary information is not disclosed without the investor's approval. Environmental and social information is also disclosed for all projects with any potentially adverse social or environmental impacts. After MIGA signs a contract of guarantee with an investor, MIGA discloses a "Project Brief" containing final details of the investment.
MIGA insures cross-border investments. This includes new investments as well as investments associated with the expansion, modernization, improvement, or enhancement of existing projects, or where the investor demonstrates both the development benefits of, and a long-term commitment to, the project. Acquisitions by new investors, including the privatization of state-owned enterprises, may also be eligible. Projects must support the host country's development goals, comply with MIGA's Policy on Social and Environmental Sustainability and anti-corruption and fraud standards, and also be financially viable.
Forms of eligible investments include equity interests, shareholder and non-shareholder loans, loan guarantees, as well as certain types of transactions in which the remuneration of the investor largely depends on the revenues or production of the investment project (e.g., technical assistance contracts, management contracts, operating leases, profit sharing contracts, and franchising agreements).
Most sectors are eligible for MIGA guarantees, including (but not limited to) financial, infrastructure, oil and gas, mining, telecommunications, services, agribusiness, and manufacturing. For examples of projects recently covered by MIGA please search our project database.
Sectors not eligible for coverage include gambling, tobacco production and processing, highly speculative investments, defense, illegal drugs, and the production of spirits.
In addition to country risks, MIGA considers project risks, including location, project viability, the sector and its importance for the host country, financial viability, potential for earning export proceeds in freely usable currency, environmental impact, and participation of local partners as well as domestic and multilateral institutions.
Yes, MIGA may on occasion offer standalone coverage except in its Small Investment Program which offers a standardized package of risk coverages.
No, MIGA provides insurance against non-commercial risks only.
Yes, MIGA has a limit per country on a net basis. However, MIGA works closely with public and private insurers, using, for example, treaty and facultative reinsurance as well as coinsurance to augment its capacity limits.
The investor should submit a Preliminary Application as soon as possible, generally before substantial funds are committed and expended for the project.
Applicants first submit a free, confidential, two-page Preliminary Application. MIGA staff determine whether a project is in principle eligible for coverage; they register the project and send the applicant a letter confirming such registration along with a Definitive Application, in which the applicant is requested to provide more detailed information.
Yes, MIGA works very closely with both public and private insurers.
Yes. MIGA can provide reinsurance; however, the primary insurer's contract must contain certain provisions required by MIGA, such as those concerning MIGA's Policy on Social and Environmental Sustainability
We are legally and financially independent, but cooperate closely with the International Bank for Reconstruction and Development, the International Development Association, the International Finance Corporation, and the International Centre for Settlement of Investment Disputes.
No, MIGA can insure investments in projects with or without the involvement of another member of the World Bank Group.
Send an email to wbgguarantees [at] worldbank.org (wbgguarantees[at]worldbank[dot]org).
Since its founding, MIGA’s guarantees have supported more than 1,000 projects. About 225 have had possible claims, but no claim needed to be paid, thanks to MIGA acting as an honest broker between the government and the private sector investors. MIGA has paid just 12 claims, most for war and civil disturbance. An additional eight claims were paid by MIGA-administered trust funds. No claims have been paid for breach of contract or non-honoring of public debt.
The small number of claims paid by MIGA since its founding in 1988 attests to the agency's ability to work with investors and host countries to find amicable resolutions to disputes. MIGA focuses on finding solutions to pre-claim situations before they reach the level of full-fledged claim, ultimately keeping the investment and its development benefits on track. MIGA's proactive facilitation efforts have been pivotal in the resolution of more than 200 disputes related to MIGA-guaranteed projects.