How Does OPIC Balance Risks, Additionality, and Development? Proposals for Greater Transparency and Stoplight Filters

April 26, 2016

As the U.S. government’s development finance institution, the Overseas Private Investment Corporation (OPIC) provides investors with financing, political risk insurance, and support for private equity investment funds when commercial funding cannot be obtained elsewhere. Its mandate is to mobilize private capital to help address critical development challenges and to advance U.S. foreign policy and national security priorities. However, balancing risks, financial needs, and development benefits is riven with numerous tensions, statutory restrictions, and tradeoffs. Using data from the OPIC Scraped Portfolio, this paper summarizes key points of how OPIC is currently managing these various tradeoffs. We conclude with several preliminary recommendations – including a proposed new stoplight tracking system for development and additionality – that may help OPIC balance its often-competing development, foreign policy, and financial demands.

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