Investment guarantees by the German Federal Government protect companies in developing, emerging and former transition countries against political risks. Investment guarantees thus help to secure projects in difficult conditions. In the case of imminent damage, the Federal Government can intervene by way of crisis management in the investment country. This also benefits smaller and medium-sized companies. The following risks are covered by a guarantee:
Investment guarantees can only be provided for eligible projects. For this, the project must utilize the German ECA in order to promote German exports. In addition, the investment in its environmental, social and human rights implications must be safe. Companies are explicitly invited to comply with the OECD Guidelines for Multinational Enterprises and the principles of the German Sustainability Code.
In order to be granted investment guarantees, there must also be sufficient legal protection for the investment in the investment country. This is regularly given if there is an investment promotion and protection agreement between Germany and the investment country. The decisions are taken by an Interministerial Committee under the auspices of the BMWi and with the participation of experts from industry.
Investment guarantees can only be provided for new investments. The application for an investment guarantee must therefore be made before the investment is made.