Investment flows both to and between developing   countries have been significantly stimulated over the past two years as a result of an initiative by the Multilateral Investment Guarantee Agency (MIGA) aimed at extending the resources of the Washington D.C.-based World Bank affiliate.

As part of a drive to more widely promote its services which insure investments in developing countries against political risk, MIGA's program of operating mobile offices is now entering its second successful year.

Caribbean The first of MIGA's mobile offices, managed by the agency's guarantees staff, was held in Barbados in July of 1997 to promote foreign investments into and between Caribbean countries. Meetings were held between some 200 prospective investors from about 125 companies and organizations interested in doing business in the Caribbean, and which provided the agency with an excellent opportunity to disseminate information on how its services could support investment into the region, especially in tourism and infrastructure.

London MIGA's efforts to continually forge links with private insurers to leverage its resources were substantially advanced with a mobile office which opened in London in March 1998. The office hosted a seminar for insurance brokers at Lloyd's of London entitled "The Changing Investment Marketplace" which drew a large audience of insurance brokers, private insurers and representatives of national insurance programs.

Building on its Caribbean experience, MIGA established similar ventures in Turkey and South Africa in  October and November of 1998. The agency's aims in establishing offices in these locations were identical to  those in the Caribbean. MIGA had only representation in  Washington and needed to reach investors in other places  who would not normally visit there. One of the agency's  main objectives is to promote investments between developing member countries, so-called "south-south" investment. However, investors from emerging markets normally do not have access to a national/public agency that can  support them and MIGA is often their only provider.

South Africa A seminar held by the South African mobile office in Johannesburg for executives from business associations, corporations and financial institutions in South Africa and neighboring countries highlighted one of the largest foreign investment projects in Mozambique: the MIGA-insured $1.3 billion Mozal Aluminum smelter project near Maputo.

Turkey The Turkish mobile office was based for a two-week period in the offices of the Istanbul Chamber of Industry during which time MIGA staff met with clients and potential investors including financial institutions  and multinational corporations. Presentations were  made on MIGA's role in the region to representatives of local and foreign corporations in Turkey, one of the top ten recipients of MIGA insurance for in- and outbound investments.

The results of both offices were excellent. MIGA  received a number of applications from both local and foreign investors, some of which have already matured into insured projects.

Japan MIGA's most recent mobile office has been the most ambitious of its kind. Held in the World Bank offices in Tokyo for the first two weeks of April, its main objectives were to meet with prospective Japanese investors, corporations and institutions interested in investing in developing countries and to sign a memorandum of understanding (MOU) on cooperation on all aspects of investment insurance with Japan's national export insurer, the Export, Import and Investment Insurance Department of the Ministry of International Trade and Industry EID/MITI.

The MIGA delegation met with senior management of  most of the Japanese trading companies and financial institutions, resulting in a great demand for follow-up seminars and meetings on specific projects. Following the signing of the MOU, MIGA and EID/MITI held their first working session during which both organizations outlined recent developments and their respective positions in certain countries. The successful relationships established during the tenure of the office resulted in MIGA hiring in July a special representative for Asia to be based in the World Bank's Tokyo office. Funded by the Miyazawa initiative, a Japanese government program to promote  Asian economic recovery, the presence of a MIGA staffer in Tokyo will allow the agency to facilitate higher amounts of much-needed investment into the region.

Since the mobile office has proven itself an extremely useful tool to establish a short-term presence outside the  United States, the agency will continue to use them as  one of its marketing tools, opening two to three such offices annually. Small-staffed, MIGA will not be able achieve representation in  all continents for several years. In the meantime, the mobile office will enable the agency to provide the kind of face-to-face contact with local investors which helps build relationships and spur investment in the developing world.

by Charles Duerden ( cad@kotra.or.kr )