Thomson Reuters recently interviewed MIGAs COO James Bond for its newly-launched website dedicated to frontier markets. Its certainly worth a browse. For now, its also a free way to get a sense of the kind of information Thomson Reuters offers on its Reuters Insider portal available to financial professionals for a fee. The focus of the piece on frontier markets —investing in challenging businesses (or business in challenging places) is hardly new. The high risk is mitigated by the potential of soaring returns: conceptually simple.

I was at a social gathering recently and was asked about MIGAs work. When I explained that we are a part of the World Bank that sells political risk insurance to encourage foreign direct investment into developing markets, my friend seemed to think that was a worthy endeavor. Good. But then I felt compelled to tell him and remind myself that that explanation is grossly incomplete and could be the marketing tagline of any private-sector insurer that provides the same service.

Why, then, is MIGA different? The second part of the elevator speech to describe MIGA involves frontier markets, many of them among the poorest countries, and post-conflict countries. I turn (briefly, I promise) to MIGAs strategic priorities which play to our foremost strength in the marketplaceattracting investors into the most difficult operating environments. This is our reason for being, its what our Convention mandates. and it is our main role within the World Bank Group. We can also provide insurance for developmentally-significant small investments .

MIGAs criteria for coverage go far beyond the balance sheet, taking into account many factors. What is the development impact of the proposed investment? Are there environmental and social concerns? Is the investment in a high-priority country (for us, that means the among the worlds poorest or conflict-affected)? Does the investment encourage South-South investment (from one developing country to another)?

Not your standard risk-assessment fare. And these considerations are what really distinguish MIGA from the private insurance market. We try to reach those markets that private insurers would be reluctant to go, particularly at a time when there are stricter underwriting conditions and reduced capacity in the market. When conditions ease, theres certainly a vast landscape for public and private providers of political risk insurance. As Bond says in the video theres probably scope for $10 billion in annual premiums a ten-fold increase from what the market is providing now.

A hearty thanks to Thomson Reuters for the interview and the platform. More thanks for implicitly suggesting, through MIGAs inclusion on the site, that development and financial outcomes need not be in contrast with respect to frontier markets.