MIGA, Japan sign deal to develop investment insurance

MIGA, Japan sign deal to develop investment insurance

TOKYO (Dow Jones): The Multilateral Investment Guarantee
Agency (MIGA) has signed a memorandum of understanding on
cooperation with Japan's national insurer -- the Export, Import
and Investment Insurance Department of the Ministry of
International Trade and Industry, MIGA said Tuesday.

The initiative will increase available political risk
insurance to cover Japanese investments in developing countries
and transition economies.

Motomichi Ikawa, executive vice president of MIGA, is
currently leading a delegation to Tokyo and Osaka until April 16
to meet with Japanese investors and companies interested in
investing in developing countries.

Speaking at a roundtable discussion in Tokyo Tuesday evening,
Ikawa said that investors are worried about political risk to
countries in Asia, Eastern Europe, and Latin America since the
Asian currency crisis occurred in the middle of 1997.

"Since the Asian currency crisis broke out, investors are
concerned about political risk to countries in Asia, Eastern
Europe and Latin America," said Ikawa. "The signing of the MOU
with MITI will have important bearing on Japanese investors as
they want coverage in Brazil, Russia, and countries in Africa,"
added Ikawa.

Ikawa also said that MIGA would help Japanese investors
seeking to invest via their overseas subsidiaries, as MITI cannot
provide insurance coverage for them, and that MIGA would hold
regular consultations with MITI in order to identify areas of
cooperation and projects in developing countries.

He expressed strong hopes that MIGA would be able to increase
its coverage for Japanese firms looking to invest overseas,
citing constructive talks recently held with trading houses and
other firms.

"MIGA should be able to easily double its coverage to Japanese
investors in the next couple of years, possibly by another US$100
million, given the great response we've had from trading houses
and investors in Japan during my visit," said Ikawa.

MIGA is the private insurance arm of the World Bank Group, and
has issued about $120 million in coverage to Japanese investors
for projects in Argentina, Bangladesh, Chile, Indonesia, Pakistan
and Peru.