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Mobilizing Private Resources for Public Investment Needs



Credit Guarantee

Financial Mobilization (pdf)




Mitigating Risk, Ensuring Fiscal Sustainability in Albania
May 19, 2016

Brazil Bridges Infrastructure Gap
with Innovative Funding Solution
November 11, 2014

MIGA’s Credit Enhancement Brings New, Replicable Solution to Bridge Infrastructure Gap in Brazil
November 11, 2014

World Bank Approves EUR 100 Million Policy Based Guarantee
for FYR Macedonia

Novermber 10, 2011

World Bank Approves EUR 300 Million Policy Based Guarantee
for Serbia

February 14, 2011

View All News >>

Case Studies

Albania:Policy based guarantee helps relieve fundind pressure and reduce debt rollover risk during volatile financial market conditions (pdf)

Brazil: An IBRD loan combined with MIGA guarantee-supported private sector financing helps the State of Sao Paulo in Brazil finance a key transport project. (pdf)

Serbia: Policy-based guarantee helps improve borrowing terms and access new financial markets (pdf)

Romania: Partial risk guarantee helps generate savings in energy sector and lower consumer tariffs (pdf)

View All Case Studies >>


A World Bank guarantee is seen by investors as a stabilizing factor in transactions with sovereign governments. By covering a government or government entity’s failure to meet specific contractual obligations to a private or public project, World Bank guarantees have helped attract direct private sector investment in oil, gas and mining, power, telecom, transport, and water projects; enhanced private sector participation in privatizations and public-private partnerships, and helped governments access international capital markets on more favorable terms.  In addition to the leverage effect, guarantees have also played a valuable role in easing the entry of emerging economies into international capital markets by helping them acquire a track record of credible policy performance.

WBG Guarantees Matrix

Identify suitable credit enhancement solutions using the World Bank Group guarantees matrix.


Project-Based Guarantees

i. General. Project-based Bank guarantees support projects with defined development objectives, activities, and results in accordance with OP 10.00, Investment Project Financing. The Bank guarantees do not support bilateral debt or debt extended by publicly owned entities that operate under public law for public policy purposes (e.g., bilateral financiers, Government owned-policy banks and export/import agencies). Bank guaranteed debt itself, is ineligible for any kind of debt restructuring without the consent of the Bank. The Bank does not provide guarantees for sovereign international borrowings for public sector projects in countries undergoing external debt restructuring until the country completes a debt restructuring agreement with commercial lenders and has in place a macroeconomic framework acceptable to the Bank.

ii. Types. Project-based Bank guarantees may be of the following types:

a. Loan guarantees. These guarantees cover loan-related debt service defaults caused by Government failure to meet specific payment and/or performance obligations arising from contract, law or regulation, in relation to a project. Loan guarantees include coverage for debt service defaults on: (i) commercial debt, normally for a private sector project where the cause of debt service default is specifically covered by the Bank’s guarantee; and (ii) a specified portion of commercial debt irrespective of the cause of such default, normally for a public sector project.

b. Payment guarantees. These guarantees cover defaults on non-loan related Government payment obligations, to private entities and foreign public entities arising from contract, law or regulation.

Policy-Based Guarantees

i. General. Policy-based guarantees cover debt service defaults, irrespective of the cause of such default, on a specified portion of commercial debt owed by Government and associated with the supported Government’s program of policy and institutional actions. In providing guarantee coverage, the Bank assesses the appropriateness of the Government undertakings, taking into account country, market and program circumstances. Policy-based guarantees do not support bilateral debt or debt extended by publicly owned entities that operate under public law for public policy purposes (e.g., bilateral financiers, government owned-policy banks and export/import agencies).


The pricing of IBRD and IDA guarantees includes several fees, and is determined based on the concept of loan equivalency with IBRD loans and IDA Credits, respectively. These fees are generally paid by the implementing entity in the case of project-based guarantees, and by the Government in the case of policy-based guarantees.

MIGA's Non-Honoring of Sovereign Financial Obligations Product

MIGA’s non-honoring of sovereign financial obligations (NHSFO) coverage provides credit enhancement in
transactions involving sovereign and subsovereign obligors. The primary beneficiaries of this cover are commercial
lenders that provide loans to public sector entities for infrastructure and other productive investments. NHSFO has the additional benefit of mobilizing financing from the private sector without using IBRD credit lines.

Learn more about NHSFO coverage (pdf 590KB)