# Multilateral Investment Guarantee Agency (MIGA): Overview and History

## What Is the Multilateral Investment Guarantee Agency (MIGA)?

The Multilateral Investment Guarantee Agency is an international institution that promotes [investment](https://www.investopedia.com/terms/i/investment.asp) in developing countries by offering political and economic [risk](https://www.investopedia.com/terms/r/risk.asp) insurance.

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

### Key Takeaways

*   The Multilateral Investment Guarantee Agency (MIGA) is an international institution that promotes investment in developing countries by offering political and economic risk insurance. 
*   The agency aims to support economic growth, reduce poverty, and improve people’s lives through foreign direct investment into developing countries.
*   MIGA is a member of the World Bank Group and has 182 member states as of October 2023.

## Understanding the Multilateral Investment Guarantee Agency (MIGA)

The Multilateral Investment Guarantee Agency (MIGA) is a member of the [World Bank Group](https://www.investopedia.com/terms/w/worldbank.asp) 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](https://www.investopedia.com/terms/i/insurance.asp) 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](https://www.investopedia.com/terms/c/capital.asp) 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](https://www.investopedia.com/terms/f/financial-guarantee.asp) 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](https://www.investopedia.com/terms/f/financial-crisis.asp).

### What MIGA Does

MIGA offers a variety of services in order to encourage foreign direct investment. These include risk insurance against [foreign exchange](https://www.investopedia.com/terms/f/foreign-exchange.asp) restrictions, an outbreak of conflicts or wars, imposed spending limits, and related restrictions on company [assets](https://www.investopedia.com/terms/a/asset.asp). 

In addition to providing political risk insurance to [corporations](https://www.investopedia.com/terms/c/corporation.asp) 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](https://www.investopedia.com/terms/f/franchise.asp), 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](https://www.investopedia.com/terms/c/capitalmarkets.asp), environmental and social sustainability, project finance and [sector](https://www.investopedia.com/terms/s/sector.asp) 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.

## Who Is Eligible for MIGA?

Corporations and financial institutions can be eligible for MIGA coverage, as can state-owned companies and investments by non-profit organizations, as long as certain requirements are met. Companies must be incorporated in a member country or majority-owned by nationals of a member country; state-owned companies and non-profit investments must be made on a commercial basis to qualify.

## Is MIGA Part of World Bank?

Yes, MIGA is part of World Bank Group. World Bank Group's stated mission is to end extreme poverty and promote prosperity; the four other institutions that comprise World Bank Group are the International Bank for Reconstruction and Development, The International Development Association, the International Finance Corporation, and the International Centre for Settlement of Investment Disputes.

## What Risks Does MIGA Cover?

As a guarantee agency, MIGA provides coverage against political risk, including the risk of war, the risk of currency inconvertibility, and the risk of expropriation (such as if the government nationalizes a project, making it impossible to complete). MIGA also protects against the risk that a sovereign nation doesn't honor its obligations.

## 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.

> **Article Sources**
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> 1.  Multilateral Investment Guarantee Agency. "[Member Countries](https://www.miga.org/member-countries)."
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> 2.  Multilateral Investment Guarantee Agency. "[About Us](https://www.miga.org/about-us)."
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> 3.  Multilateral Investment Guarantee Agency. "[History](https://www.miga.org/history)."
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> 4.  Multilateral Investment Guarantee Agency. "[Our Process](https://www.miga.org/our-process)."
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> 5.  Multilateral Investment Guarantee Agency. "[Investment Opportunities Abound in Afghanistan](https://www.miga.org/press-release/investment-opportunities-abound-afghanistan)."
>     
> 6.  Multilateral Investment Guarantee Agency. "[KTZ Railway Project](https://www.miga.org/project/ktz-railway-project-1)."
>     
> 7.  Multilateral Investment Guarantee Agency. "[About Senior Management](https://www.miga.org/about/management)."
>     
> 8.  World Bank Group. "[Who We Are](https://www.worldbank.org/en/who-we-are)."
>     
> 9.  Multilateral Investment Guarantee Agency. "[Providing Political Risk Insurance And Credit Enhancement Solutions](https://www.miga.org/sites/default/files/2018-06/MIGA%20products.pdf)," Page 1.