World Bank guarantee arm MIGA visits Iraq

By Lesley Wroughton

WASHINGTON (Reuters) - The World Bank's private sector guarantee arm has visited Iraq, signaling to the Iraqi government interest from international firms and the need to move quickly to lay the groundwork for investors to go in.

During six years of war in Iraq investors have waited patiently for signs that the country is ready to accept increased foreign investment.

"We have real expressions of interest in Iraq," said James Bond, chief operating officer at the Multilateral Investment Guarantee Agency, or MIGA, who was part of the delegation that traveled to Baghdad last month.

"We have several companies talking to us closely about Iraq," Bond added.

"There is a firm interest in not-so-critical areas and a huge interest in what everyone sees, both the government and investors, as having huge potential, which is oil, gas and electric power sector," he said.

However, he said enthusiasm has been tempered by investor concerns over how secure their investments will be in a country where the political and security environment is still fragile.

In addition, there is nervousness about the outcome of Iraqi elections in December and planned withdrawal of between 92,000 and 107,000 U.S. troops over the next 18 months.

In many ways that is why MIGA was established in 1988 -- to promote foreign direct investment in developing countries by guaranteeing the safety of projects through political risk insurance.