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.