Grupo del Istmo de Papagayo, S.A.

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In fiscal years 2001 and 2002, MIGA issued a total of $38.3 million in guarantees to Wings of Papagayo, LLC (WP) for its $27.6 million equity investment in, and $15.0 million shareholder loan to, Grupo del Istmo de Papagayo, S.A., a Costa Rican development project. The coverage was offered for a period up to 13 years against the risks of Expropriation. In 2003, WP increased its equity investment in the project with an additional $10 million. MIGA re-wrote its existing equity coverage to include this additional amount, providing a guarantee of $33.3 million. The 2003 guarantee is for a period of 13 years and provides coverage against the risk of Expropriation. In addition, MIGA provided $47.7 million in guarantees to Scotiabank (Cayman Islands) Ltd. (BNS), a branch of the Bank of Nova Scotia of Canada, for its non-shareholder loan to the project. MIGA's coverage to BNS is also for up to 13 years and provides coverage against the risks of Transfer Restriction, Expropriation and War and Civil Disturbance.   The project involves the development of a 210-room resort set on approximately 120 acres of the Papagayo Peninsula in the country's Pacific northwest province of Guanacaste. The eco-sensitive project is dedicated to high environmental standards and was designed to preserve ecological and cultural resources in the project area.   The development impacts from the project do not differ from those reported in 2001. As a result of the project, 340 jobs will have been created with significant training both on-site and abroad. Furthermore, the project has numerous upstream benefits for local companies as 70% of all products are procured locally.

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