One of MIGA’s more dubious projects, the report claims, was its decision last October to insure a $24 million investment by Coca-Cola in Bosnia-Herzegovina to modernise a bottling plant.
MIGA “does not explain how making Coke readily available will alleviate poverty or promote health,” the report says. It also argues that soft drinks promote obesity. In any case, said Welch, “Coke certainly has the capacity to go to private insurers instead.”
Varkie, MIGA’s marketing manager, rejected those arguments. In a country torn by war and food shortages, “obesity is not the issue,” she said. “In an area where people are desperate to get their economy going, without support from agencies like MIGA those companies wouldn’t go in. Projects like this are critical in getting the confidence back of the investment community.” Many companies that receive MIGA guarantees, Varkie said, “make a huge difference and go way beyond what’s necessary from a corporate responsibility point of view.” - SUNS4941
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Monday, May 24, 2010
Recent projects listed on MIGA’s website include joint ventures with the Greek Export Credit Insurance Organization and South Korea’s Export Insurance Corporation to encourage Greek and Korean investment in developing countries.
The NGO report takes MIGA to task on several fronts.
First, it says, MIGA guarantees corporate investment in mines in Indonesia, Peru and elsewhere that are “environmentally damaging and developmentally dubious.”
Second, it claims that MIGA’s guarantees mirror existing trends in FDI rather than “catalysing FDI for positive purposes into the regions and countries that need it the most.”
“There’s a need to channel investment to countries not getting it,” particularly in Africa and Central America, said Welch.
Third, the report argues that too much of MIGA’s portfolio, nearly 38%, is focussed on the financial sector, including guarantees to multinational banks for opening new branches or expanding operations to provide loans in the developing world. These are geared towards middle- and upper-income individuals rather than the poor, and benefit large banks such as Citigroup, the report says.
The bottom line for MIGA’s critics is its alleged lack of accountability on improving the environment. Investments by large multinationals in mines, power plants and other infrastructure projects, the report claims, are poorly monitored and often result in serious pollution and other damage to the local environment.
“MIGA has no screening process to ensure that its investments do not benefit corporations that have track records of harming the environment and human rights,” it says. The report claims that the US government’s Overseas Private Investment Corp. and the World Bank’s International Finance Corp. have much better oversight
The NGO report takes MIGA to task on several fronts.
First, it says, MIGA guarantees corporate investment in mines in Indonesia, Peru and elsewhere that are “environmentally damaging and developmentally dubious.”
Second, it claims that MIGA’s guarantees mirror existing trends in FDI rather than “catalysing FDI for positive purposes into the regions and countries that need it the most.”
“There’s a need to channel investment to countries not getting it,” particularly in Africa and Central America, said Welch.
Third, the report argues that too much of MIGA’s portfolio, nearly 38%, is focussed on the financial sector, including guarantees to multinational banks for opening new branches or expanding operations to provide loans in the developing world. These are geared towards middle- and upper-income individuals rather than the poor, and benefit large banks such as Citigroup, the report says.
The bottom line for MIGA’s critics is its alleged lack of accountability on improving the environment. Investments by large multinationals in mines, power plants and other infrastructure projects, the report claims, are poorly monitored and often result in serious pollution and other damage to the local environment.
“MIGA has no screening process to ensure that its investments do not benefit corporations that have track records of harming the environment and human rights,” it says. The report claims that the US government’s Overseas Private Investment Corp. and the World Bank’s International Finance Corp. have much better oversight
As a first step in that process, Representative Sherrod Brown, a Democrat from Ohio, is introducing this week a provision to a foreign aid appropriations bill that would shift the US contribution to MIGA to an international tuberculosis fund, Welch said.
The US holds the largest number of shares in MIGA and therefore has the strongest voting clout. Other top shareholders are Japan, the United Kingdom and Germany. China is the largest shareholder from the developing world.
MIGA, which has 154 members, was designed to encourage private investment in developing countries “by providing viable alternatives in investment insurance against non-commercial risks,” according to the agency’s statement of purpose.
Its insurance covers corporations and financial institutions against such risks as currency restrictions, government expropriation, breach of contract and wars and civil disturbance. It also offers marketing advice to help its developing-country members promote their own investment opportunities.
It is closely linked with World Bank efforts to encourage privatisation in developing countries. Last April, the agency launched a website, called PrivatizationLink, that details privatisation programmes in individual countries and provides potential investors with reports on trends and “leading-edge practices” in the transfer of public companies to private ownership.
Nepal Insurance Company Limited,
Nepal Insurance Company Limited, a pioneer non life insurance company of Nepal was established on 1947 A.D. by Nepal Bank Limited (the first commercial Bank) and general public with 51% and 49% shares respectively.At the beginning the name of this company was "Nepal Malchalani Tatha Beema Company" and had changed its name as "Nepal Insurance & Transport Company Ltd." on 1959 A.D. Now its name is "Nepal Insurance Company Ltd." since 1991 A.D.
MIGA officials reacted sceptically to the report, saying it was filled with factual mistakes and unsubstantiated allegations that reflect the authors’ failure to visit MIGA clients or conduct an in-depth review of MIGA operations. But they said MIGA would conduct a careful review of the critique and issue a formal response.
“Of all the World Bank Group institutions, we’re probably the least understood,” said Moina Varkie, MIGA’s marketing manager.
“But there is a fundamental philosophical issue at stake,” Varkie told IPS. “Either you believe FDI (foreign direct investment) promotes jobs and fights poverty, or you don’t. We believe FDI is critical to growth.” MIGA, by providing guarantees, makes private investment possible in countries where there is a strong perception of political risk,
she said.
Since MIGA was founded in 1988 as the fifth agency of the World Bank Group, it has provided more than $7 billion in risk insurance in 75 countries. For the last two years, MIGA’s largest recipients have been businesses investing in Brazil, Argentina, Peru, Russia and Turkey.
FOE is working with right-wing groups here that have also called for MIGA’s abolition, including the Heritage Foundation and the Cato Institute.
Their dislike of the agency was reinforced last year by the Meltzer Commission, which studied the World Bank and the International Monetary Fund on behalf of the Republican-controlled Congress. It recommended the elimination of MIGA because of the many private-sector insurers that have entered the market and the existence in many countries of national political
insurance agencies.
“Of all the World Bank Group institutions, we’re probably the least understood,” said Moina Varkie, MIGA’s marketing manager.
“But there is a fundamental philosophical issue at stake,” Varkie told IPS. “Either you believe FDI (foreign direct investment) promotes jobs and fights poverty, or you don’t. We believe FDI is critical to growth.” MIGA, by providing guarantees, makes private investment possible in countries where there is a strong perception of political risk,
she said.Since MIGA was founded in 1988 as the fifth agency of the World Bank Group, it has provided more than $7 billion in risk insurance in 75 countries. For the last two years, MIGA’s largest recipients have been businesses investing in Brazil, Argentina, Peru, Russia and Turkey.
FOE is working with right-wing groups here that have also called for MIGA’s abolition, including the Heritage Foundation and the Cato Institute.
Their dislike of the agency was reinforced last year by the Meltzer Commission, which studied the World Bank and the International Monetary Fund on behalf of the Republican-controlled Congress. It recommended the elimination of MIGA because of the many private-sector insurers that have entered the market and the existence in many countries of national political
insurance agencies.World Bank insurance wing under attack
Washington, 19 Jul 2001 (IPS) - An obscure World Bank agency that guarantees private investment in developing countries should be abolished and its funds redirected toward efforts that help people and the environment, say activists.
Their target is the Multilateral Investment Guarantee Agency (MIGA), which provides corporations and banks with insurance coverage against political risks in developing countries.
Armed with a new report, entitled ‘Risky Business,
Their target is the Multilateral Investment Guarantee Agency (MIGA), which provides corporations and banks with insurance coverage against political risks in developing countries.
Armed with a new report, entitled ‘Risky Business,
MIGA’s critics are kicking off a campaign
to pressure the US and European governments to cut off funding or withdraw from the agency.“MIGA has the worst environmental and public disclosure policies of any World Bank lending agency,” said Carol
Welch, deputy director of international programmes at Friends of the Earth (FOE). “It’s more interested in helping multinational corporations than advancing development.”FOE released the study with Urgewald, a German non-governmental organisation (NGO), and Italy’s Campaign for the Reform of the World Bank. The US-based Charles Stewart Mott Foundation and several other philanthropies focussed on international issues funded the research.
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