What Is the Multilateral Investment Guarantee Agency (MIGA)?

The Multilateral Investment Guarantee Agency is an international institution that promotes investment in developing countries by offering political and economic risk insurance.

By promoting foreign direct investment into developing countries, the agency aims to support economic growth, reduce poverty, and improve people’s lives.

Understanding the Multilateral Investment Guarantee Agency (MIGA)

The Multilateral Investment Guarantee Agency (MIGA) is a member of the World Bank Group and is headquartered in Washington, D.C. As of October 2023, 182 member governments make up MIGA: 154 developing nations and another 28 industrialized countries.

History of MIGA

The agency was created to complement both public and private investment insurance sources against non-commercial risks in developing countries. Its multilateral character and sponsorship by advanced and developing nations were seen as bolstering confidence among people going across borders to invest their money.

In September 1985, the World Bank endorsed the idea of a multilateral political risk insurance provider and established MIGA in April 1988. The agency started out with $1 billion worth of capital among its initial 29 member states. These nations included Bahrain, Bangladesh, Barbados, Canada, Chile, Cyprus, Denmark, Ecuador, Egypt, Germany, Grenada, Indonesia, Jamaica, Japan, Jordan, Korea, Kuwait, Lesotho, Malawi, Netherlands, Nigeria, Pakistan, Samoa, Saudi Arabia, Senegal, Sweden, Switzerland, United Kingdom, and the United States.

In 1991, the number of member states of MIGA topped 100. Eight years later, guarantees issued by the agency reached a total of $1.3 billion, topping the $1 billion dollar mark for the first time ever. The agency also provided guarantees worth $1.2 billion in 2009 to support the economies in Europe and Central Asia following the global financial crisis.

What MIGA Does

MIGA offers a variety of services in order to encourage foreign direct investment. These include risk insurance against foreign exchange restrictions, an outbreak of conflicts or wars, imposed spending limits, and related restrictions on company assets. 

In addition to providing political risk insurance to corporations that want to invest in developing countries, MIGA offers advisory services to developing country governments. The organization advises on the policies and procedures these governments should follow and the best ways these countries can attract foreign investment. Other services by MIGA include licensing arrangements, franchising, and technology support.

To help ease the flow of foreign investment dollars into certain regions, the agency supports and runs a number of international projects. For instance, in September 2023, MIGA backed a $621 million loan to the National Railway Company Kazakhstan Temir Zholy (“KTZ”). The project will help Kazakhstan repair and improve its national railways and expand its fleet of electric railcars while supporting the nation's low-carbon initiatives. These modernizations will improve the speed and reliability of rail transit and transport.

MIGA's Leadership Team 

According to MIGA, the people in its group have experience in political risk insurance and are well-versed in banking and capital markets, environmental and social sustainability, project finance and sector specialties, and international law and dispute settlement.

The group's management team include Hiroshi Matano, executive vice president, and Junaid Kamal Ahmad, vice President, operations. Other members of senior leadership include Ethiopis Tafara, vice president and chief risk, legal and administrative officer; Aradhana Kumar-Capoor, director and general counsel; Muhamet Fall, director for infrastructure, MAS, and trade operations; and Deepti Jerath, director, finance and risk.

The Bottom Line

With insurance from the Multilateral Investment Guarantee Agency, cross-border investors and lenders can confidently commit capital in developing countries. MIGA promotes the flow of capital and investment as part of its mission to reduce poverty across the globe and its coverage reduces the risk of loss from political reasons, such as war.