Mitigating Currency Convertibility Risks in High-Risk Countries : A New IDA Lending Approach

• Tác giả: Karen Rasmussen
• Ngôn ngữ: eng
• Ký hiệu phân loại: 332.45 Foreign exchange
• Thông tin xuất bản: World Bank, Washington, DC, 2012
• Bộ sưu tập: Tài liệu truy cập mở
• ID: 324634
• Chủ đề: 1. CONVERTIBILITY; 2. DEVELOPMENT CREDIT AGREEMENT; 3. EQUITY INVESTMENTS; 4. INVESTMENT RISKS; 5. RISK MANAGEMENT

Tóm tắt

A proposed Currency Convertibility Fund, backstopped by a contingent credit from the International Development Association (IDA)-the World Bank's concessionary window for the world's poorest countries-has been designed for the Songo Songo Gas Development and Power Generation Project in Tanzania. The fund is a transitional mechanism aimed at supporting the Tanzanian government's efforts to attract foreign equity in circumstances where the private sector perceives a high level of risk and is otherwise unwilling to invest. The fund may be a replicable mechanism that, by mitigating sovereign risks that investors are unwilling to bear and unable to hedge against, could help catalyze foreign equity investment in other IDA countries and in projects that generate local currency.