The Risks We Run: Mining Communities and Political Risk Insurance

Crucial to the financing of major third world development projects is ‘political risk insurance’ (PRI). PRI is intended to cover foreign investors for losses due to nationalisation, restriction on financial transfers, breach of contract, war or ‘revolution.’ PRI is made available out of public funds by institutions such as the World Bank’s MIGA, USA’s OPIC and UK’s ECGD. Without PRI many large projects would not be able to proceed. The Risks We Run focuses on its most controversial aspect: PRI provided for large scale mines. Roger Moody maintains that the export credit agencies involved have woefully failed to anticipate the disastrous consequences of their promotion of mining, while providing PRI for major mining projects counteracts sustainable development.