Catalog

	Table of Contents
p. 17 of 21 BACK | NEXT I. Introduction II. An Overview of the Political Risk Insurance (PRI) Market III. Review of ADB's Partial Risk Guarantee (PRG) Program IV. Recommendation for Changes to ADB's PRG A. Redefining the Coverage of the PRG Instrument B. Defining the Fee Structure C. Covering Interest D. Introducing a PRG Prudential Limit E. Introducing a Coguarantee Program and a Collaboration Program F. Improving the Product Name G. Improving Communications with the Market and Potential Users H. Creating a PRG Focus Group I. The Use of ADB’s Financing Instruments and Staff Implications J. Summary of Proposed Changes to the PRG V. Potential Benefits of the Proposed PRJ Program VI. Conclusion

Review of the Partial Risk Guarantee of the Asian Development Bank : IV. Recommendation for Changes to ADB's PRG

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H. Creating a PRG Focus Group

67. A focus group has been formed to relaunch the PRG program along the lines recommended in this paper. This group is chaired by the Private Sector Group, and includes representatives from the Office of Cofinancing Operations, the Treasurer’s Department, the Office of the General Counsel, the Strategy and Policy Department, and from the projects and programs departments, in order to mainstream PRGs across ADB. A PRI expert was retained to advise ADB on various PRG issues and to provide access to the latest knowledge in this area.³⁶ Specifically, it is recommended that the PRG focus group take responsibility for:

1. initiating PRG pilot projects and developing close cooperation with MIGA, ECAs, and other experienced PRI institutions from the public and private sector, as they have significant institutional experience in underwriting, risk analysis, documentation, and pricing;

2. finding innovative ways to collaborate with existing PRI providers, both public and private, to expand the availability of cost-effective PRI coverage for the more challenging projects in the region which PRI providers might otherwise avoid or overprice;

3. preparing operational guidelines for the PRG program, which will also show how the program compares and contrasts with the PCG and other credit enhancement products of ADB;

4. providing additional inputs for the Guarantee Committee to assist with pricing of guarantees;

5. drafting standardized contracts, underwriting criteria, and provisioning policies; and

6. developing a targeted communication strategy and training program for use within ADB and with the outside market.

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