introduction to migaâ€™s products and services

I N S U R I N G I N V E S T M E N T S E N S U R I N G O P P O R T U N I T I E S

Introduction to MIGA’s Products and Services

John R. WilleManager -Outreach, Partnerships and Information Services

WORLD BANK GROUP MULTILATERAL INVESTMENT GUARANTEE AGENCY

2WORLD BANK GROUP MULTILATERAL INVESTMENT GUARANTEE AGENCY

Agenda

About MIGA

Portfolio highlights

FDI from Greece

MIGA’s services to investors

• Guarantees

• Online investor information services

• Balkan Investment Facilitation Program


The World Bank Group

1944 IBRD International Bank forReconstruction and Development

1960 IDA International Development Agency

1956 IFC International Finance Agency

1966 ICSID International Centre for the Settlement of Investment Disputes

1988 MIGA Multilateral Investment Guarantee Agency

Created

Promotes FDI through guarantees and technical

assistance

ABOUT MIGA


MIGA — Background

Owned by 164 member countries

Created with a mandate to promote investments into developing countries, achieved through:

• Political risk guarantees

• Capacity building and advisory services to member countries on foreign direct investment

• Information dissemination on investment opportunities online through IPAnet, PrivatizationLink and FDI Xchange websites

• Investment facilitation

• Investment dispute mediation

GUARANTEES PORTFOLIO


Portfolio Highlights

$4.36

$0.13$0.42

$1.05

$2.28

$2.86

FY90 FY92 FY94 FY96 FY98 FY00

$5.20

FY01 FY02

$5.25

$5.08

FY03 FY04

$5.19 billion

$12.8 billion issued in 85 countries since 1988

$51.1 billion of FDIfacilitated (est.)

Gross Exposure



Gross Exposure, as at June 30, 2004

$5.2 billion

by Sector

InfrastructureFinancial

Oil, Gas & MiningAgribusiness & Manufacturing

Tourism & Services

38351197

by Region

Europe & Central AsiaLatin American & Caribbean

Sub- Saharan AfricaAsia & the Pacific

Middle East & North Africa

383313135

%

%



Top Investor and Host Countries, as at June 30, 2004

GrossHost Country Exposure

(%) $M

Brazil 10.5 562

Bulgaria 6.7 357

Romania 6.2 332

Mozambique 6.0 319

Serbia and Montenegro 5.6 296

Croatia 5.2 275

Russian Federation 4.7 269

Bosnia and Herzegovina 4.5 252

Argentina 3.4 240

Turkey 3.2 179

Total 56.0 2, 985

GrossInvestor Country Exposure

(%)

Austria 20.0

United States 13.1

France 11.7

Netherlands 8.5

Spain 7.4

United Kingdom 6.4

Germany 4.9

South Africa 4.5

Canada 3.8

Czech Republic 2.6

Total 82.9


Agenda

About MIGA


FDI from Greece


• Guarantees




FDI from Greece No. of projects - October 2002 – January 2005

Eastern Europe

Southern Europe

China

Sub-Saharan Africa

0 10050

South East Europe

150 200


FDI from Greece by Destination CountryOctober 2002 – January 2005

No. of % of

Projects Projects

Bulgaria 37 20.2%

Romania 33 18.0%

Serbia & Montenegro 22 12.0%

China 8 4.4%

Macedonia 8 4.4%

Albania 7 3.8%

UK 6 3.3%

Hungary 6 3.3%

Nigeria 6 3.3%

Cyprus 5 2.7%


FDI from Greece by sectorOctober 2002 – January 2005

No. of % of

Projects Projects

Food & Drink 30 16.4%

Textiles 29 15.8%

Financial Services 23 12.6%

Metals/Mining 14 7.7%

Real Estate 12 6.6%

Business Services 10 5.5%

Hotels, Tourism & Leisure 8 4.4%

Energy 8 4.4%

Building Materials, Ceramics & Glass 7 3.8%

Machinery & Industrial Goods 7 3.8%


Agenda

About MIGA


FDI from Greece


• Guarantees



MIGA’S GUARANTEE PROGRAM


Currency Transfer Restrictionand Inconvertibility

Protects against losses arising from

Inability to convert local currency into Forex

Inability to transfer



Expropriation

Protects against losses arising from

Nationalization and confiscation

Creeping expropriation

Partial expropriation (expropriation of funds)

Non-discriminatory measures not covered



War and Civil Disturbance

Protects against losses arising from:

Damage/disappearance of tangible assets (including revolution, insurrection, coups d'état, sabotage, and terrorism)

Business interruption when investment is a total loss



Breach of Contract

Protects against losses arising from:

Breach or repudiation of a contract between the investor and the Host Country authorities

Non-enforcement of an arbitration award is a prerequisite

Applied to breach of supply/take-off contract, a license agreement, etc., and breach of a sub-sovereign guarantee obligation



Our Unique Strengths

Member of World Bank Group

Umbrella of deterrence – ability to resolve pre-claim situations to satisfaction of investor (consequently only 2 claims paid in 16 years, fully recovered)

Objective intermediary between governments and investor countries

Extensive resources and in-depth knowledge of emerging economies from all parts of World Bank Group

MIGA’S PRODUCTS AND SERVICES


Terms and Conditions

Eligibility — New investments (min. 3 years)

Investment types :

• Equity

• Shareholder loans

• Loan guaranties

• Non-shareholder loans

• Non-Equity Direct Investments

Tenors — Coverage up to 15 years (on occasion 20 yrs)

Amounts — Depending on capacity of country and up to $200 million directly (greater amounts possible through coinsurance and syndication)

Coverage — Equity covered up to 90% & Debt up to 95%

Premium rates usually range between 30 and 100 basis points (up to 150 in some cases)

MIGA’S PRODUCTS AND SERVICES


Eligible Investment – non-equity direct investment

Technical Assistance

Management Contracts

Profit Sharing Agreements

Operating Leases

Franchising and Licensing Agreements

Performance Bonds (wrongful call)

minimum three-year term


Operator Lenders

Loan

MIGA

Investment Project

Expropriation Transfer Restriction, War and Civil Disturbance, Breach of Contract

Shares/ shareholder loan


Foreign Service Provider( EPC contractor, O&M

contractor, management service provider)

MoF

Lenders

EPC*/O&M/Management Contract

Breach of Contract

Loan

Breach of Contract, Expropriation, Transfer Restriction, War and Civil Disturbance

MIGA Public Works

Min. Revenue Guarantee **

Min. Revenue Guarantee**

Including associated performance bond** Could be to public works or directly to lenders


MIGA PROCESS

Application Process

Preliminary application

Submit preliminary application before the investment is made or irrevocably committed

Available online

Free

Confidential

Can be withdrawn at any time

Definitive application

Detailed form, with information on investment, developmental and environmental impact

Application fee

Confidential


Agenda

About MIGA


FDI from Greece


• Guarantees




ONLINE INVESTOR INFORMATION SERVICES:

Investment Promotion Network — www.ipanet.net

Investment opportunities, business environment and market analysis

Database links to over 13,000 investment-related resources, drawn from over 1,000 organizations

Information cataloged by country, topic and sector for easy retrieval

Contacts for investment promotion and privatizations agencies; project funding and support services

Widely used by site selectors and corporate development staff, over 26,000 visitors per month


ONLINE INVESTOR INFORMATION SERVICES:

FDI Xchange — www.fdixchange.com

E-mail alert service

Provides links new information and investment opportunities matching user’s country, sector and topic interests

Currently delivered directly into 7700+ investors’ inboxes

Used by client countries to “push” information to potential investors

Operates on same database as IPAnet


ONLINE BUSINESS INFORMATION SERVICES:

PrivatizationLink — www.privatizationlink.com

Project Pipeline

Details upcoming privatizations, company information, divestiture plans, bidding procedures, and contacts

Country Information

Overview of national privatization programs, sectoral data, as well as privatization-related laws and regulations in over 70 emerging economies


Agenda

About MIGA


FDI from Greece


• Guarantees




European Investor Outreach Program (EIOP)

Objective: Promote FDI into the Western Balkans

Outcomes Expected: Site visits and realised investments. High quality jobs and high value exports

Pilot Program for 2 years

Funded by the Austrian Ministry of Finance and MIGA


European Investor Outreach Program (EIOP)

Main Activities:

Stimulating the interest of investors to invest in the region “developing the reasons to invest”

Dissemination of information to support investor decision-making

Facilitating the interest of investors by helping to make the investment decision easier

Ensuring that investor needs are understood by host country governments

Providing coaching and mentoring to investment promotion agencies through “learning by doing”.


European Investor Outreach Program

Stimulating the interest of investors

Helping to elaborate the “reasons to invest”

Benchmarking and Sector competitiveness study- underway December 04-Feb 05

- Auto components

- Food and beverages

- Other niche sectors

Competitiveness initiatives undertaken by USAID and others.



Dissemination of Information

Targeted sectoral outreach activities (March 05 onwards) –including May event in Thessaloniki

Collaboration with chambers and industry associations in Europe

Dedicated informational Web site – www.eiop.org



Facilitating Investor Interest

Assisting with access to project and feasibility study finance (e.g, BidFacility)

Access to loan and equity finance (e.g., IFC, EBRD, EDFI members)

Assisting with access to political risk insurance (MIGA and other insurance providers)

Working with national investment promotion agencies to ensure investor information and facilitation needs are met.

For further information, contact:Dermot Coffey, EIOP Facility Manager; [email protected]


Thank you!

For more information, www.miga.org

introduction to migaâ€™s products and services

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