The Multilateral Investment Guarantee Agency (MIGA), one of the two private-sector-focused organizations under the World Bank Group with the International Finance Corporation, hopes to help China play a bigger role in attracting foreign direct investment (FDI) and to allow Chinese enterprises to invest overseas, the agency's Asian chief said yesterday in Beijing.
"We are planning further co-operation with the Chinese Government and investors to play a bigger role in helping more FDI flow to China and to assist in its economic development," Philippe Valahu, MIGA's Asia regional director, said at the FDI Promotion and Development Forum. The event was organized by the Beijing Haidian District government and Administration Committee of Zhongguancun Science Park yesterday.
MIGA has provided guarantees for 12 projects worth US$80 million in China, bringing in US$413 million foreign capital.
Valahu said half of the investments were made in the energy sector and the rest in the manufacturing industry.
He said that after China began opening itself to the world 20 years ago, many foreign investors already knew China very well and may not have needed guarantees for their investments. But there is still plenty of room for an organization like MIGA to develop in China.
Valahu believes that with China's efforts to develop its vast and less-developed western regions and to direct foreign investments there, MIGA can offer guarantees to investors to help them mitigate their risks, since local infrastructure, management and technological levels lag much behind more advanced eastern provinces and municipalities.
At the same time, the opening of infrastructure systems to foreign investments, such as water and gas supply, has brought opportunities to foreign investors as well as risks in such areas as prices and contractual disputes.
As more Chinese companies begin to expand overseas, MIGA will provide investment guarantees to help them reduce their risks.
Valahu said his organization will hold talks with China Export and Credit Insurance Corp (SinoSure) this week to discuss opportunities for co-guaranteeing projects for Chinese investors.
(China Daily September 8, 2003)
