S'pore expected to play key role in providing insurance against political risk

Channelnewsasia    By Ryan Huang, Jonathan Peeris         07 April 2010 2101 hrs

SINGAPORE: Singapore is expected to play a key role in providing insurance against political risk for cross border investments in the region.

This is according to the World Bank's Multilateral Investment Guarantee Agency (MIGA) whose study shows that nearly four in 10 respondents investing into emerging markets are taking risk management more seriously.

Emanuel Salina, senior investment officer, World Bank's Multilateral Investment Guarantee Agency, said: "What we see is that the crisis has brought risk in general to the forefront.

"It has made risk more evident to investors. I think before the crisis, everybody got very comfortable with taking risks without actually measuring or understanding them adequately. And the crisis has shown that risks actually exist."

Trade promotion agency IE Singapore said Asia will need almost US$8 trillion in infrastructure investments over the next 10 years and it expects Singapore to be able to leverage on its strong insurance sector.

Angela Png, group director, International Organisations, IE Singapore, said: "In terms of getting more of the pie, it goes with the whole eco-system of Singapore being a financial hub.

"Because if more investors are coming into Singapore to invest or regionalise out of Singapore, then the insurance will be part of the whole financing solutions. So there is the opportunity, now ironically with the crisis and awareness of risk, for the insurers to sort of get in on the action."