Ministry of Economy Expects Seven Projects for Military Risk Insurance from MIGA and DFC by the End of 2023.
The Multilateral Investment Guarantee Agency (MIGA) of the World Bank Group and the U.S. International Development Finance Corporation (DFC) may carry out three and four projects respectively for military risk insurance in Ukraine by the end of the year, announced First Deputy Prime Minister and Minister of Economy of Ukraine, Yulia Sviridenko.
According to her presentation at the Regional Economic Forum in Kyiv this week, MIGA focuses on projects involving international investors, while DFC is open to collaboration with both international and Ukrainian investors.
MIGA insures investment risks such as political, currency inconvertibility, and expropriation, whereas DFC also provides trade finance services and credit portfolio guarantees.
It is noted that MIGA has insured military risks for $143 million in the financial sector and $14 million in the real sector of the economy.
Sviridenko added that the European Bank for Reconstruction and Development (EBRD) is also establishing a fund of EUR 200 million, with participation confirmed by eight funds. This fund will insure goods in transit and storage against military risks for both foreign and Ukrainian investors, in addition to providing trade finance and guarantees for it.
According to the presentation, national export credit agencies (ECAs) from Japan, Germany, France, Italy, Sweden, and the UK have already expressed interest in military risk insurance for their residents.
Furthermore, the Polish export credit agency, KUKE, offers military insurance for trade, property, and investment risks to both international and Ukrainian investors, as stated in the presentation.
The First Deputy Prime Minister noted that the government expects the adoption of bill No. 9015 in the second reading, which aims to expand the mandate of the Ukrainian ECA for military risk insurance.
Among the challenges in establishing military risk infrastructure, Sviridenko pointed out the insufficient number of projects and applicants, low synergy, and ambiguous acceptability criteria.
Souurce: AgroPortal