The Malawi Investment Promotion Agency (MIPA) has agreed to market the services of the nascent African Trade Insurance Agency (ATI) in Malawi. This means that eligible businesses in the southern African country will be able to obtain cover for non-commercial risks such as trade embargoes, war, expropriation and seizure of goods.

Cover is available for several types of transaction, including loans by foreign and local lenders, the sale of goods on credit terms, the import or export of goods for processing, the import or export of goods to stock for sale and letter of credit confirmation.

FDI flows

Established last year, the ATI is charged with addressing the issue of weak foreign direct investment (FDI) flows into Africa. Less than 1 percent of global FDI flowed into Africa in 2000, according to estimates from the United Nations Conference on Trade and Development.

Membership is open to all African countries, with the initiative being launched by Burundi, Kenya, Malawi, Rwanda, Tanzania, Uganda, and Zambia. Other African countries have expressed interest in joining the effort.

The initiative is supported by the World Bank affiliate charged with promoting foreign direct investment into emerging economies, the Multilateral Investment Guarantee Agency (MIGA) and funded by the bank's soft-loan arm, the International Development Association (IDA), which has pledged a US$105 million loan to the ATI.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.