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March 2012

Ignore the Political Economy at your own Peril

Rebecca Post's picture

Imagine a conversation. “So, your company is expanding its operations in country x, but I hear there is a lot of frustration among young people about unemployment. Are you worried about the possibility of political upheaval?” And the investor responds, “We’re not very worried about any instability. The current government has been in power for decades and we’re very well connected, so if there are any problems, we’ll be protected.” Without naming names, we can think about how this approach to risk management may have failed investors as of late, but such reversals of fortune predate the days of Twitter and Facebook – take the fall of the Suharto regime in Indonesia. At MIGA’s recent discussion titled “Best Laid Plans? How Ignoring Political Economy Affects Development Outcomes and Increases Risk", this attitude toward risk was aptly labeled “risk myopia.”

Sustainable Development: the Business-class Train Has Left the Station and the Canary is in the Coal Mine

Cara Santos Pianesi's picture

Last week, MIGA hosted a panel discussion on the role of the private sector in sustainable growth as part of the World Bank Group’s Sustainable Development Network Forum 2012. Taking the initiative as an agency of the World Bank Group that encourages investment by the private sector, MIGA brought this angle to the more general sustainable growth discussion.

Keynote speaker Jeffrey Leonard from the Global Environment Fund opened citing the World Bank President’s remarks on sustainable development that were right on the money – outlining an urgent need for attention to the matter, noting that resources must be made available  – yes, good, onward! The catch? They were attributed to a president who left office 25 years ago (Tom Clausen).

MIGA: Beyond "Project of the Year"

Kevin Lu's picture

Today in Singapore, MIGA and IE Singapore co-hosted a seminar:"Managing Global Political Risks: Old Risks, New Moment."

After the welcome speech by IE's Assistant CEO Terence Seow, Michel Wormser, MIGA's Vice President and COO, delivered the keynote speech, which touched upon the current global economic turbulence, potential investment opportunities for Asian investors, the perception of risks, and what role the World Bank Group can play in facilitating private capital into productive projects. Michel noted that—while he understands that many Asian companies tend to invest in nearby countries—there are also plentiful of opportunities in Africa and Latin America.