dfc.gov

CONGRESSIONAL

BUDGET 

JUSTIFICATION

Fiscal Year 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table of Contents 

EXECUTIVE SUMMARY __________________________________________________________________ 1 

DFC GOALS _______________________________________________________________________________ 5 

MAXIMIZE DEVELOPMENT IMPACT....................................................................................5 

DRIVE PRIVATE CAPITAL TOWARD U.S. FOREIGN POLICY OBJECTIVES ...................................6 

GROW OUR INVESTMENTS...............................................................................................6 

FY 2021 DFC BUDGET REQUEST ________________________________________________________ 8 

ADMINISTRATIVE EXPENSES .............................................................................................9 

Payroll and Facilities ..................................................................................................... 9 

Governance and Accountability ................................................................................... 9 

Operationalizing Interagency Collaboration ............................................................ 10 

Monitoring and Evaluation......................................................................................... 10 

Financial Management Technology........................................................................... 11 

New Authorities—Implementing Resources ............................................................. 11 

Transaction Resources ................................................................................................ 12 

FUNDING DFC’S PROGRAMMATIC AUTHORITIES ............................................................. 12 

Credit and Insurance................................................................................................... 13 

Technical Assistance and Feasibility Studies ............................................................ 13 

Equity Program Funding ............................................................................................. 13 

FY 2021 POLICY PRIORITIES __________________________________________________________ 15 

OFFICE OF INSPECTOR GENERAL ____________________________________________________ 18 

APPENDICES____________________________________________________________________________ 19 

APPENDIX A: APPROPRIATIONS LANGUAGE .................................................................... 19 

Corporate Capital Account........ ................................................................................. 19 

Program Account...... ................................................................................................... 20 

APPENDIX B: FISCAL YEAR 2019 IN REVIEW ................................................................... 21 

Overseas Private Investment Corporation (OPIC) .................................................... 21 

Development Credit Authority (DCA) ......................................................................... 25 

APPENDIX C: BUILDING THE DFC—TRANSITION TIMELINE............................................. 30 

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Executive Summary

Development and foreign policy challenges require a new transformational approach— 

supported by the tools, strategy, and resources to meet these challenges. The 

President’s FY 2021 Budget proposes resources and strategies to support the bipartisan 

vision of the BUILD Act. DFC proves the United States’ comparative advantage over 

autocratic financing models by highlighting transparency, leveraging the private sector, 

financial sustainability, high environmental, social, and worker rights standards, and a 

willingness to invest in small and medium sized enterprises. 

The Budget proposes $133.7 million for administrative expenses and project-specific 

transaction costs, and a program budget of $700 million—including a new equity 

program, credit subsidy for loans and guarantees, grants, feasibility studies, and project— 

specific technical assistance. The budget also requests $2 million for a dedicated 

Inspector General for the new agency. These resources will enable DFC to take full 

advantage of the tools authorized in the BUILD Act to meet development and foreign 

policy challenges. FY 2021 will mark DFC’s first full year of operations and DFC will be 

focused on meeting the requirements and ambitions of the BUILD Act so as to ensure 

that the United States is well equipped to both meet development challenges and 

compete effectively with the investment initiatives of other autocratic governments. 

The Budget will allow DFC to expand on the classic financing and insurance work of 

OPIC and DCA, and establish and grow new business lines authorized by BUILD, such as 

project specific technical assistance and equity. 

The request level achieves an outsized impact by using DFC to leverage multiples of 

private sector investment. By engaging the private sector, DFC supported projects not 

only extend the impact of scarce federal resources, but also align spending with projects 

which are more likely to be viable over the long haul, and therefore to deliver long term 

development impact. This budget level reflects the kind of transformation envisioned in 

BUILD for DFC to bear more risk and achieve more development impact. 

Importantly, DFC positions the United States to provide an alternative to the financing 

model offered by autocratic governments. The amount these governments have planned 

are staggering—putting perhaps as much as $1 trillion into shaping the developing world. 

Fortunately, developing countries are searching for an alternative to investment capital 

that can often leave them worse off. This request puts DFC in a position to answer that 

call in a meaningful way. 

DFC will extend its core capability of mobilizing market-based, private-sector led 

development in support of development outcomes and U.S. foreign policy. DFC, as part 

of U.S. development efforts, complements a diverse set of U.S. foreign policy tools and 

traditional assistance efforts. 

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DFC will use its financing tools in partnership with the private sector to fulfill three key 

aims: 

1. Maximize Development Impact: DFC mobilizes private sector investment to

advance development in emerging economies around the world.

2. Drive Private Capital Toward U.S. Foreign Policy Objectives: DFC serves as a

critical tool of American foreign policy, mobilizing investment in regions, and

industry sectors of strategic importance.

3. Manage Taxpayer Risk Through Appropriate Investment Growth: DFC will

prudently manage its portfolio and share risks with the private sector and

qualifying sovereign entities through co-financing and structuring of tools.

A strong, well-resourced DFC can complement and amplify foreign assistance efforts 

undertaken daily by partner agencies such as the U.S. Agency for International 

Development (USAID), the Department of State, and the Millennium Challenge 

Corporation (MCC). DFC builds on the strength of nearly 50 years of development 

finance programs at OPIC, and nearly 20 years of the DCA program. The human and 

financial capital of OPIC and USAID combine with DFC’s reforms and new tools to 

enhance the effectiveness of U.S. development finance efforts, improve taxpayer 

protections, transparency, and interagency coordination. Beyond mobilizing capital, DFC 

investment promotes the adoption of good business practices, quality jobs, and sound 

environmental policies. 

This budget request will ensure that DFC has the resources to meet market demand, 

strengthen DFC core capabilities, and improve both development and foreign policy 

outcomes worldwide. DFC will deploy its resources while continuously coordinating with 

State, USAID’s missions, the MCC, and others, to support development and foreign 

policy through projects and cross-cutting whole of government initiatives such as: 

• Women’s Economic Empowerment: DFC’s 2X Women’s Initiative invests in

businesses that are owned by or led by women, or which deliver a product

or service that benefits women.

• Power Africa and Prosper Africa: Like OPIC and DCA with Power Africa, DFC

will be a key contributing agency to both Power Africa and the new Prosper

Africa Presidential Initiative, which seeks to advance the United States’

competitive advantage by accelerating two-way investment and trade with

Africa. On February 20, 2020, President Donald J. Trump selected U.S.

International Development Finance Corporation (DFC) Chief Executive

Officer Adam Boehler to serve as Executive Chairman of Prosper Africa.

DFC will be on the forefront of facilitating private sector investment in

Africa to improve infrastructure, support new technology, create value

chains, and solve logistical challenges. State-directed investments have left

many African states with unsustainable debt or projects, making DFC’s

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model of private sector-led development all the more important. A focus 

on infrastructure, information and communications technology, value 

chains, and logistics can help advance African countries on their journey to 

self-reliance. 

• Indo-Pacific: DFC is committed to advancing a free and open Indo-Pacific:

a vast region including India, Southeast Asia, and the South Pacific that is

home to more than half the world’s population.

• America Crece ́ : DFC will help enhance energy and infrastructure security,

and increase investment throughout Latin America and the Caribbean. The

initiative is an innovative, whole-of-government approach to designing

achievable energy and infrastructure growth programs that address the

most pressing investment barriers in each market.

• Critical Infrastructure: DFC investments will help build roads, airports,

seaports, and power plants, supporting increased trade and regional

connectivity.

• Energy: DFC investments will help countries meet the growing demand for

electricity, while introducing electricity in remote regions, expanding

access to renewable energy, and promoting energy independence.

• Healthcare: DFC investments will expand access to affordable healthcare

by building modern hospitals and health clinics and supporting projects

that expand access to clean water and sanitation.

• Technology: DFC investments will expand access to the advanced

technology and telecommunications services that are essential for business

activity and economic growth.

DFC will use its administrative resources to integrate the legacy USAID DCA operation, 

build out new service offerings authorized under BUILD, and strengthen DFC in three 

main areas: 

1. Create Innovative Programs and Partnerships to Maximize Outcomes

o Maintain and expand partnerships with USAID, State, MCC, and other

federal agencies to foster an “all of government” approach to promoting

development.

o Create valuable partnerships with other Development Finance Institutions

(DFIs), International Finance Institutions (IFIs), NGOs, think tanks, and

others, to maximize development impact without duplication or undue

competition.

2. Foster an Effective and Efficient Organization

o Improve project sponsor and partner experience to increase DFC

opportunities.

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o Provide necessary resources to DFC staff to enable effective and efficient

operations.

o Strengthen enterprise and departmental decision making through data and

analysis.

o Leverage technology to provide staff with global system access.

o Empower staff to create a productive and positive work environment to

attract and retain skilled personnel.

3. Maintain a Responsible Organization Over the Long Term

o Maintain a fiscally responsible organization, generating long-term value for

the taxpayer.

o Create and empower management and oversight structures that monitor

progress towards achieving policy goals, that assess success while

remaining within acceptable risk thresholds, and that take action where

appropriate.

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DFC Goals 

Maximize Development Impact 

DFC will emphasize support for developmental projects. In collaboration with top 

experts in development, DFC created a new state-of-the-art framework for evaluating 

development impacts. DFC will use the new “Impact Quotient” (IQ) framework to 

calculate a score based on each project’s projected and actual contribution to economic 

growth, inclusion, and innovation to help focus the new DFC’s development agenda. The 

score will be adjusted for environmental, social, and development risks. Utilizing IQ, DFC 

will collect baseline, projected, and actual data to measure each project’s progress 

toward its development objectives. Using IQ, DFC will ensure that investments have a 

positive impact on the populations it serves and will push DFC to increase the quantity 

of projects while also ensuring that the highest quality of projects are supported. 

DFC will prioritize low-income and low-middle-income countries. Serving the most 

disadvantaged populations is core to DFC’s mission and at the heart of DFC’s investment 

goals. To ensure DFC is meeting this priority, DFC will re-organize its approach to 

business development, turning from a “demand-driven” culture, to one that seeks out the 

most developmental opportunities for every resource expended on a transaction. 

DFC will use its capital to promote projects that empower women. Women drive growth 

and foster stability in their homes, communities, and economies. Yet women face 

extreme barriers to achieving full participation and contribution to the economy and 

society as a whole. DFC will use the power of its investments to create gender equitable 

change. 

DFC will promote projects that support job creation through small business growth, and 

support populations with limited access to financing. To promote job creation through 

small businesses, DFC supports: 

• Investment funds that target small businesses for equity investments;

• Financial institutions that lend to small businesses and microenterprises;

• The development or expansion of small businesses; and

• Support to medium and larger companies in sectors that have a

demonstrated ability to drive local investments in new goods and service

providers.

DFC will build on its experience in encouraging financial institutions and funds to reach 

out to populations that have not had access to financial resources in the past, including 

women, youth, and rural populations, so that they can finance microenterprises, small 

businesses, or household expenses. In addition, DFC will provide technical assistance 

intended to support future DFC transactions to companies that have not previously 

served these populations, so that they can determine the viability of expanding services 

to these segments of the populace. This may increase their access to key resources 

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including energy and water or to obtain necessary communications or IT services 

essential to small business development. 

Drive Private Capital Toward U.S. Foreign Policy Objectives 

DFC will be one of the most effective, nimble tools of the United States foreign policy 

apparatus. DFC will serve as a key element of U.S. foreign policy through mobilization of 

private capital in development finance. As a result of the BUILD Act, mobilizing the 

power of the private sector is now a more prominent tool of U.S. foreign policy. DFC, in 

coordination with the NSC, State, and USAID, will be a more effective tool to support 

growth and stability in countries where the United States has a strategic interest. There 

is a global recognition that achieving economic and political stability in less-developed 

countries will depend largely on private sector investment. 

DFC will play a critical role in bringing new capital to emerging market development. 

Private capital can spur global development funding as investors seek opportunities in 

developing countries. However, pools of private sector capital remain largely untapped 

due to a variety of factors, including high regulatory risk, fragmented supply chains, and 

monopolies in critical sectors, like power and transportation. 

DFC will provide an alternative to state-led investment by authoritarian regimes. At a 

time when developing countries are incurring dangerous levels of debt from statedirected lending, DFC private sector-led model will seek to build stable and prosperous 

societies, strengthen local markets, reduce dependence on foreign aid, and develop 

critical infrastructure that is built to last. DFC will adhere to high standards of 

international financial institutions related to governance, and provide transparency, debt 

sustainability, as well as environmental and social safeguards. 

The United States must compete, however, for these positive outcomes. Other countries 

are seeking to project their economic and geopolitical influence. China, for instance, has 

promised resources to initiate long-term efforts to invest over $1 trillion in Eurasia, 

Africa, and Latin America. Rather than meeting competitors at the lowest common 

denominator or engaging in practices that distort markets, the United States will use its 

development finance tools to pursue development and national-security objectives while 

projecting American values and norms, and promoting responsible business practices in 

partner countries. These relationships will, over the long term, strengthen the 

geopolitical position of the United States, and provide the economic foundation for 

future international partnerships. 

Grow Our Investments 

DFC will increase its portfolio size in terms of the number of projects supported, dollars 

invested, and insured. With an increased investment cap and more flexibility, DFC is 

positioned to deploy more capital and have a greater impact to support U.S. foreign 

policy objectives. 

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Promote the Creation of New Sources of Private Capital in Areas of Strategic Interest 

Private capital mobilization in support of sustainable, broad-based economic growth, 

poverty reduction, and development through demand driven partnerships with the 

private sector advances U.S. foreign policy interests. Leveraging private-sector resources 

to promote economic growth in developing countries helps extend American influence 

and reinforce American values, such as the rule of law, transparency, and fair business 

practices. Emerging market trading partners that adhere to free-market principles and 

promote transparent, rules-based governance today, will provide a market for American 

goods and services tomorrow. 

DFC will develop innovative financial products that increase opportunities to mobilize 

private capital and meet local needs. Backing from DFC, through development finance 

tools such as loans, guarantees, political risk insurance, feasibility studies, and equity can 

catalyze significant amounts of private capital into emerging markets. This backing is 

essential to supporting key sectors such as infrastructure, power, water and health; 

improving the quality of life for millions, laying the groundwork for creating modern 

economies, and/or providing financing for women or other sectors that have not had 

sufficient—or any—access to commercial financing. 

Promote Innovative Programs and Partnerships to Maximize Outcomes 

DFC will create valuable partnerships with other U.S. federal agencies, development 

finance institutions, NGOs, think tanks, and the private sector to create maximum 

development impacts most efficiently. DFC recognizes that non-government 

stakeholders not only play an important accountability role, ensuring that DFC maintains 

the highest standards, but also play a critical advisory and partnership role. 

DFC will leverage the expertise and thought leadership that outside stakeholders 

provide, so that DFC can better assist the people whom it exists to serve. DFC and many 

foundations share a common mission, but bring different resources and tools to the 

table. DFC will leverage foundations’ expertise and grant capital to expand its reach and 

impact. DFC values the resources non-government stakeholders bring to the table 

including research, sector expertise, and regional presence. Specifically, DFC sector 

teams in innovative healthcare, food and agriculture, next generation infrastructure, and 

energy will take advantage of stakeholder knowledge and capability. 

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FY 2021 DFC Budget Request

(Dollars, thousands) FY 2019 

Actual 

FY 2020 

Enacted 

PL 116 94 

FY 2021 

Request 

Change from 

FY 2020 

Enacted 

Overseas Private Investment -341,044 - - -

Corporation 

Administrative Expenses 79,200 - - -

Credit Subsidy 20,000 - - -

Offsetting Collections -440,244 - - -

USAIDs Development Credit 10,000 - - -

Authority 

Administrative Expenses 10,000 - - -

Credit Subsidy Transfer [55,000] - - -

Limitation 

Development Finance - -262,000 337,677 599,677 

Corporation 

Subtotal, - 299,000 833,677 534,677 

Admin/Program 

Administrative Expenses - 119,000 133,677 14,677 

Program Funds - 180,000 700,000* 520,000 

Of which, Credit Subsidy 

Technical Assistance / - 30,000 - * 

Feasibility Studies 

Of which, Equity - 150,000 - * 

Offsetting Collections - -561,000 -496,000 65,000 

Inspector General 2,000 2,000 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

Other - [50,000] [50,000] -

Complementary Programming - [50,000] [50,000] -

and/or Transfers from 

State/USAID Economic Support 

and Development Funds 

1 Bracketed amounts are transfers from USAID/State (e.g. ESDF, GHP) to DCA in FY19/20 and to DFC in the 2021 Budget. 

* Funding may be flexibly allocated among equity, credit subsidy, technical assistance, feasibility studies, and other programs.

DFC requests $133.7 million for administrative expenses and project-specific transaction 

costs. In addition, DFC requests $700 million in program funds, which can be flexibly 

allocated among credit subsidy, grants, technical assistance, and special projects and 

programs. Facilitated by the Chief Development Officer, DFC anticipates $50 million in 

funding allocated to State/USAID will be transferred to DFC to support Administration 

priorities. The budget also requests $2 million to be appropriated from the General Fund 

for the Office of Inspector General to conduct independent oversight. 

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Administrative Expenses 

This budget request is expected to fund all existing OPIC and DCA positions and new 

responsibilities to begin implementation of DFC’s new equity, grants, and technical 

assistance programs. 

The agency, going into its first full year, will require funding to continue the momentum 

of consolidating, modernizing, and reforming the development finance capabilities of the 

U.S. Government, ensuring access to a much deeper toolkit of development finance tools 

and expertise than has been available in the past. This access to DFC’s financing tools is 

a critical complement to USAID’s core objective of promoting a path to a recipient 

country’s self-reliance and resilience. At the same time, DFC will leverage the global 

footprint of U.S. embassies and missions around the world to realize its growth 

ambitions, while driving deeper impact in its portfolio and more closely monitoring and 

adjusting its global projects portfolio throughout the world. 

Summary of Requested Budget Increases Estimated 

vs FY 2020 $, millions 

Payroll & Facilities 6.33 

Governance and Accountability 1.00 

Operationalizing Interagency Collaboration 0.46 

Monitoring and Evaluation 2.80 

Financial Management Technology 2.00 

New Authorities – Implementing Resources 0.51 

Transaction Resources – Staff and Contracting 1.57 

Support 

TOTAL 14.67 

Payroll and Facilities

The request assumes an estimated hiring of 30 new employees. This includes FTE 

positions for offices required by statute, increased evaluation and monitoring activity, 

interagency coordination, and responding to new reporting requirements mandated by 

the BUILD Act. This budget will also fund adaptation of existing leased space and other 

costs driven by a larger workforce. 

Governance and Accountability 

As required by the BUILD Act, DFC will have an Independent Accountability Mechanism 

to address concerns, complaints or conflicts about environmental or social issues that 

may arise around DFC-supported projects. The office provides project-affected 

communities, project sponsors, and project workers an opportunity to have such 

concerns independently reviewed and addressed. 

In addition, DFC has two offices which report directly to the board: the Chief 

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Development Officer (CDO) and the Chief Risk Officer (CRO). This request provides 

base funding for operating costs of those offices and travel. The CDO and CRO will 

leverage the entire organization to fulfill their mandates. 

The CDO will be responsible for focusing the entire organization on driving measurable 

development impact and ensuring DFC’s portfolio meets its development mandate at the 

strategic level. The CDO will also coordinate DFC’s development policies and 

implementation efforts with the interagency, particularly USAID, MCC, and State. The 

CRO will provide executive-level guidance to DFC by identifying and advising on 

mitigation efforts regarding the most significant risks facing DFC, including operations, 

credit programs, financial exposures, and reputational risks. 

Operationalizing Interagency Collaboration

The Office of Strategic Initiatives (OSI) will ensure DFC is effectively integrated into the 

interagency policy-making process and can help ensure foreign-policy alignment with the 

Administration’s priorities. For example, individuals from this office will represent DFC in 

the development of new Administration initiatives—such as Prosper Africa and the IndoPacific Strategy—and ensures DFC delivers on these initiatives. OSI will be structured 

along regional and thematic lines, and will interact regularly with the transaction-focused 

Departments as well as the Office for Development Policy (ODP) and CDO, based on 

region or sector. Through these regional and thematic lines OSI will have the ability to 

deploy priority initiatives across the globe. OSI will also link other federal departments 

and agencies that support U.S. businesses overseas, such as the Department of 

Commerce and the U.S. Export-Import (EXIM) Bank. OSI will tap into other U.S. 

Government Departments and Agencies for detailees, as appropriate, for interagency 

experience, and serve as a key link into the Development Finance Coordination Group. 

Ensuring interagency U.S. Government staff understand how DFC originates, analyzes, 

structures, monitors, and evaluates its transactions is critical for even the most basic 

close collaboration across Federal institutions. This understanding is particularly 

important for USAID staff, who will source DFC transactions directly to support existing 

USAID programs in-country. Funding will support DFC’s development of a 

comprehensive training program, in coordination with USAID, State, and other U.S. 

Government Departments and Agencies. This program will complement OPIC’s legacy 

training to the Foreign Service Institute (FSI) and USAID’s existing training on PrivateSector Engagement, and will be available to all interagency staff. Working with State, 

DFC is programming funds for DFC personnel to be placed in the market to develop 

business through the lens of U.S. national security and foreign policy. 

Monitoring and Evaluation

The BUILD Act called for modernizing OPIC’s monitoring and evaluation (M&E) 

framework to appropriately measure the developmental performance of the new DFC’s 

portfolio, including the replacement of the current development impact measurement 

system. The new performance measurement system will provide a mechanism for 

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ensuring that support provided by DFC is in addition to private sector investment. The 

system will set new standards and methods for ensuring accurate developmental 

performance of DFC’s portfolio—including the measurement of projected and ex-post 

development impact of a project—and information necessary to comply with the annual 

reporting requirements, economic and social development impact, worker rights, 

environmental impact, and women’s economic empowerment. Funding supports the 

major requirements laid out in the BUILD Act such as compliance, U.S. Government 

coordination, reporting, ex-post analysis of projects, and effects of DFC. 

The Budget includes funding to support the development of an M&E portal to internally 

track and manage activities under this function. With the addition of USAID’s DCA 

portfolio and the growth expectations for DFC over its authorization, it is vital to support 

M&E data and workflows. The portal will be used by clients, DFC, and any U.S. 

Government agencies that are involved in DFC’s efforts. The portal will be primarily 

focused on tracking site visits, collecting data from those visits, administering the 

surveys, and linking the key project documents together in a data warehouse. This 

modernization will also include a mobile app designed for streamlined, on the ground, 

data collection that will allow DFC to collaborate with other U.S. Government agencies 

to help understand DFC’s development impact. 

In addition to portfolio-level performance measurement, DFC requires support to 

implement balanced agency-level performance measurement across the key dimensions 

of client and employee satisfaction, quantity, and quality. 

Financial Management Technology 

The Corporation’s accounting system leverages OPIC’s systems and experience in 

managing OPIC’s diverse risk portfolio. OPIC’s systems at its foundation requires 

resources to support licenses, databases, maintenance, periodic upgrades, and 

enhancements. 

The FY 2021 request will support a periodic upgrade of systems to support base 

functionality and security as well as invoicing, financial workflows, and new reporting 

requirements. The FY 2020 appropriation for example, enabled DFC to initiate work to 

support direct loans in foreign currencies and variable rate lending. 

The FY 2021 request includes a small effort to begin the multi-year work to migrate the 

corporate accounting platform to a cloud "software as a service" platform—where the 

vendor internalizes numerous maintenance functions in a uniform “cloud” environment, 

rather than using corporate resources to implement and test upgrades, and maintenance 

packages. Over time, this platform can generate savings and more efficient access to 

new features. 

New Authorities—Implementing Resources

The BUILD Act established a new program for direct equity investment governed by 

rigorous guidelines and criteria. While OPIC had a track record with its investment funds 

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unit, new work is necessary to prepare the Corporation to prudently manage the 

workflow and the related accounting, monitoring, and valuation activities and data for 

the equity program. 

DFC’s grants and technical assistance program funds technical assistance, feasibility 

studies, and training that implement DFC’s mission of mobilizing private capital to 

advance development and support of U.S. foreign policy objectives. A grant and/or 

technical assistance provided to a project is designed to increase the development 

impact, or improve the commercial sustainability, of a project that has received, or may 

receive, DFC financing or insurance support. This assistance will be designed to 

complement, but does not duplicate, work funded by other agencies or sources of 

financing. 

Transaction Resources 

DFC’s goal is to leverage the tools in the BUILD Act and increase the level of investment 

it supports by growing the portfolio in key regions and sectors that are key to the 

Administration’s development and foreign policy objectives. To meet these goals, DFC is 

working to scale up existing transaction capacity and controls. These funds include 

supporting technology, project specific transaction costs, and professional services 

integral to the origination and monitoring process. 

Transactions in frontier economies which achieve BUILD Act objectives—the triplebottom line of development impact, foreign policy and national security objectives, and 

managing taxpayer risk—all require DFC to review projects and manage the portfolio at a 

project-by-project level. 

Funding DFC’s Programmatic Authorities 

DFC requests $700 million to support its credit, equity, technical assistance, and other 

special projects activities. This request will allow DFC to scale up to the challenges and 

ambitions the Administration and Congress sought to tackle with the establishment of 

DFC. It will allow DFC to expand on the traditional financing and insurance work of 

OPIC and DCA and establish and grow new business lines authorized by BUILD, such as 

project specific technical assistance and equity. As DFC expands its financing, its tools 

are likely to require incrementally more credit subsidy because of the greater focus DFC 

will have on less developed countries. As DFC launches new products and partnerships, 

and focuses on new markets, DFC’s mix of business will naturally be in flux, so a 

combined programmatic request allows flexibility to use the most appropriate tool for 

each situation. 

DFC also anticipates that the Chief Development Officer will facilitate the transfer of an 

additional $50 million from State/USAID to DFC for State/USAID to leverage DFC’s 

development finance tools to support Administration priorities. 

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Credit and Insurance 

DFC will optimize and grow the credit and insurance programs recently used by OPIC 

and DCA. The FY 2021 budget will support an estimated $7.6 billion in direct and 

guaranteed loans. The increased portfolio authorization and addition of modern 

investment tools will equip DFC to mobilize substantial capital to advance development 

and grow economies to promote inclusive economic growth in the world’s least 

developed countries. DFC’s budget will implement the authority to support direct loans 

in local currencies—enabling DFC to mobilize local resources. DFC’s debt financing will 

be available for emerging market private equity funds through an open and competitive 

process. 

Technical Assistance and Feasibility Studies

Technical assistance designed to complement DFC programming will cover a wide range 

of activities tailored to the specific needs of individual transactions, including feasibility 

studies, market studies, development of lending strategies and products, financial 

literacy and business development services for borrowers, and the training of loan 

officers. Early support for planning and project development enables more well-planned 

projects to get off the ground and may be necessary to realize critical infrastructure 

projects. By lifting specific projects to the level where DFC’s investment tools can scale 

the project, this technical assistance will help enhance development impact. Regular 

interactions between DFC and interagency through the CDO and other mechanisms will 

ensure that this programing will not duplicate programming done by USAID, MCC, and 

other agencies. 

Equity Program Funding

While debt financing and political risk insurance remain important programs, one of the 

central components of the BUILD Act is the equity authority that allows DFC to play a 

greater catalytic role in mobilizing private sector capital to help meet the United States’ 

foreign policy and development goals. 

The BUILD Act requires that equity authority be used with projects that have a clearly 

defined development and foreign policy purpose, and to consider objectives such as: 

• Reducing identified market failures;

• Reducing significant project delays;

• Contributing to the transformation of local conditions to promote market

development;

• Aligning with commercial partner incentives;

• Identifying significant development impact and long-term commercial

sustainability; and

• Supporting the policies of the United States Government.

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DFC’s equity business will build on well-established funds products (to which OPIC could 

only lend) and expand in new directions to reach and work with a broader set of 

partners. Equity will also be used to make direct investments. 

DFC, through its funds debt-product, has long-standing systems in place to select 

managers and funds with successful track records. Equity investing into funds will be a 

natural extension that makes DFC a more attractive partner to other DFIs, and as a 

result, funds are expected to be an early area of growth. DFC will select experienced and 

successful fund managers to promote broad U.S. foreign policy and development goals, 

such as infrastructure and the 2X initiative, focusing on less developed countries in key 

policy areas and on strategic sectors that are important to U.S. interests. Further, with 

equity authority, DFC will be able to invest on the same basis along with DFIs of close 

allies (e.g. the United Kingdom’s CDC, Germany’s DEG, France’s Proparco) and private 

sector partners (U.S. pension funds and financial institutions). 

DFC sees direct equity investment as an invaluable tool to drive highly developmental 

and highly strategic investment over time, where more traditional lending or insurance 

products may not work as a commercial matter or may not provide the same medium to 

long-term benefits. 

DFC plans to build a pipeline from at least four sources: (1) co-investment rights in most 

or all invested funds, (2) reviewing loan and insurance portfolios for companies or 

projects that are good candidates for equity investment, (3) referrals from other DFI 

partners (e.g. IFC has expressed a willingness to partner alongside them) and (4) direct 

business development opportunities. 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 14 
 

 

 

 

 

 

 

 

 

 

FY 2021 Policy Priorities 

Critical to DFC’s success are strong linkages to U.S. policymakers to ensure DFC both is 

complemented and guided by U.S. foreign policy, development, and national security 

objectives. Under a new Board structure, the Secretary of State will serve as Chair and 

the USAID Administrator will serve as Vice-Chair of DFC. In the past, OPIC has primarily 

operated on a “demand driven,” private sector–initiated approach to respond to the 

needs of U.S. businesses. While that “demand driven” model will continue, the 

Administration will also make greater use of DFC to advance U.S. foreign policy 

objectives in the developing world. This includes the USAID mission-led dealdevelopment approach currently used by DCA that will allow USAID missions—now with 

more financial tools—to support priority areas and increase development impact. 

Through its network of embassies around the world, State will ensure that DFC tools and 

resources are deployed in the context of a policy-driven approach to advance specific 

U.S. foreign policy and development priorities. 

The budget assumes State and USAID will provide $50 million in Economic Support and 

Development Assistance Funds (ESDF) for complementary programming and transfers, 

to maintain the current model used by DCA and to support Administration foreign policy 

priorities. Whether DFC is deployed in Africa, the Indo-Pacific, or the Western 

Hemisphere, its investment tools and high standards, must be available to offer an 

alternative to the state-directed approaches by strategic competitors which can leave 

developing countries worse off. 

Below are some of the ways in which DFC is expected to advance Administration 

priorities in FY21: 

• Indo-Pacific Strategy: The Administration’s Indo-Pacific strategy envisions

a peaceful and secure region of sovereign nations, supports a framework

for economic growth that is private sector-led, and encourages a

governance model that promotes growth through open, transparent, and

rules-based economies. DFC will be closely aligned with the broader

interagency—including through initiatives such as the Digital Connectivity

and Cybersecurity Partnership, Asia Enhancing Development and Growth

through Energy, and the Infrastructure Transaction and Assistance

Network—to support investment for digital connectivity, energy, and

sustainable, high-quality infrastructure.

No government alone has enough money to address the Indo-Pacific’s

economic and development needs, such as the region’s annual $1.7 trillion

need for infrastructure financing.1 This challenge requires strategic

partnerships, which is why OPIC signed a trilateral MOU with Japan and

Australia and agreements with others in the region to combine resources,

1 Asian Development Bank, Meeting Asia’s Infrastructure Needs, Asian Development Bank, 2017, xi. 

https://www.adb.org/sites/default/files/publication/227496/special-report-infrastructure.pdf 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 15 
 

technical expertise, and priva tesector funding. While signed under OPIC, it 

is expected that these initiatives will begin showing results in FY21. 

• Women’s Global Development and Prosperity Initiative (WGDP): OPIC’s

2X Women’s Initiative helped set the standard for what it means to invest in

women. Doing so not only addresses a significant gap in access to

financing, but advances U.S. interests to create more stable and

prosperous societies. The BUILD Act’s priority on women’s economic

empowerment means DFC will continue OPIC’s 2X Initiative and play a

critical role in the WGDP’s support for women’s entrepreneurship and

access to capital, markets, and technical assistance.

The WGDP initiative will help ensure collaboration between DFC and

USAID’s WGDP fund, which invites interagency transfers. This close

collaboration will undoubtedly lead to instances where DFC support can

help scale an enterprise originally backed by USAID grant funding. For

example, on a recent trip to Ethiopia, OPIC’s Acting President and CEO

signed a letter of interest with a women-owned business which originally

began to grow with the help of USAID funding. Additionally, USAID is

backing the issuance of a $100 million women’s livelihood bond in Asia

through a DCA guarantee to support the WGDP initiative.

• Power Africa and Prosper Africa: Like OPIC and DCA with Power Africa, DFC

will be a key contributing agency to both Power Africa and the new Prosper

Africa Presidential Initiative, which seeks to advance the United States’

competitive advantage by accelerating two-way investment and trade with

Africa. On February 20, 2020, President Donald J. Trump selected U.S.

International Development Finance Corporation (DFC) Chief Executive

Officer Adam Boehler to serve as Executive Chairman of Prosper Africa.

DFC will be on the forefront of facilitating private sector investment in

Africa to improve infrastructure, support new technology, create value

chains, and solve logistical challenges. State-directed investments have left

many African states with unsustainable debt or projects, making DFC’s

model of private sector-led development all the more important. A focus

on infrastructure, information and communications technology, value

chains, and logistics can help advance African countries on their journey to

self-reliance.

• América Crece: Latin America and the Caribbean are not only close

neighbors, but also key partners in promoting regional security and

stability. This region accounts for almost one quarter of DFC’s global

portfolio and is the site of DFC investments in critical infrastructure,

energy, agriculture, and financial services. The América Crece initiative is an

innovative, whole-of-government approach to designing achievable energy

and infrastructure growth programs that address the most pressing

investment barriers in each market.

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 16 
 

• Critical Infrastructure: DFC’s investments in critical infrastructure

including roads, airports, seaports, and pipelines will help create jobs and

economic growth. Through increased access to markets, these projects

also improve overall quality of life in the developing world by enhancing

energy access, spurring business activity, strengthening agricultural supply

chains, and raising the quality of healthcare and education. DFC financing

is supporting the construction of two major toll roads in Colombia that will

improve safety reduce travel times, and expand important commercial

routes to help rural farmers reach larger markets.

• Energy: DFC investments will help countries meet the growing demand for

electricity, while introducing electricity in remote regions, expanding

access to renewable energy, and promoting energy independence. DFC is

expanding and diversifying power generation in El Salvador by constructing

the country’s largest thermal power plant, which will increase the country’s

power generating capacity by 23%, helping to meet growing demand and

reduce the country’s dependence on diesel and heavy fuel oil. DFC also

added a new source of electricity in Indonesia by financing an awardwining 75 megawatt wind power plant in Sulawesi that is significantly

increasing the country’s power supply

• Healthcare: DFC is focused on creating a healthier world by investing in

projects that address persistent challenges in the developing world. DFC

investments will expand access to affordable healthcare by building

modern hospitals and health clinics, while supporting projects that expand

access to clean water and sanitation. For instance, DFC financing

supported the construction of a major clinic in Angola that offers

affordable outpatient services to the community as well as a modern

training program for medical professionals.

• Technology: DFC is committed to expanding access to trusted

technologies that enhance connectivity in the developing world and make

business more efficient and secure. DFC invests in projects that introduce

advanced telecommunications services in underserved areas, and in

technology businesses that offer innovative products and services.

Financing from DFC is supporting mobile network updates and expansions

in the Democratic Republics of the Congo, The Gambia, Sierra Leone, and

Uganda to make mobile internet services more affordable.

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 17 
 

 

 

 

 

 

 

 

Office of Inspector General 

The BUILD Act establishes several oversight structures to govern the agency overall. 

DFC will have its own specialized Inspector General (IG) to conduct reviews, 

investigations, and inspections of its operations and activities. The Office of Inspector 

General will improve the economy, effectiveness, and efficiency of DFC, while also 

working to detect waste, fraud, abuse, and mismanagement. 

The Budget proposes $2 million to fund an Office of Inspector General for DFC. 

Consistent with principles of independence, this amount should be appropriated from 

the General Fund of the Treasury and not be offset by collections of the agency. The IG 

will produce future budget requests to be submitted separately, in accordance with the 

Inspector General Act. 

The $2 million figure for the initial set up of DFC’s IG is primarily based on the amounts 

that would be necessary to start up the Inspector General office, which would cover four 

FTE (Inspector General, Auditor, Counsel/Investigator, and a support individual) with the 

balance of the funding going to contracting for mandatory audits and inspections. 

Previously, OPIC was under the jurisdiction of USAID’s Inspector General pursuant to a 

reimbursable Memorandum of Understanding (MOU) funded at $1 million per year. 

Similarly, DCA’s activities have been overseen by the USAID IG. As the statute calls for a 

Designated Federal Entity Inspector General for DFC, appointment and removal 

authority for the Inspector General resides with the Board. The new Inspector General 

will fill vacant positions in its office out of its own line-item budget and will coordinate 

the transition of any items in which the USAID IG is still working. 

DFC is actively recruiting for a new IG and has interviewed several candidates. Until an 

IG is in place, USAID’s IG, with reimbursement from DFC, will continue to provide 

investigative services and audit services for statutorily required audits (such as those of 

credit card transactions and requirements of the Federal Information Security 

Management Act), and it will complete any outstanding program audits. 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 18 
 

 

 

 

 

Appendices 

Appendix A: Appropriations Language 

Corporate Capital Account

For necessary expenses of the activities described in subsections (b), (c), (e), (f), and (g) of 

section 1421 of the BUILD Act of 2018 (division F of Public Law 115–254) and for 

administrative expenses to carry out authorized activities and project-specific transaction 

costs described in section 1434(d) of such Act, $833,677,000: Provided, That the United States 

International Development Finance Corporation (the Corporation) is authorized to make such 

expenditures and commitments within the limits of funds and borrowing authority available to 

the Corporation, and in accordance with the law, and to make such expenditures and 

commitments without regard to fiscal year limitations, as provided by section 9104 of title 31, 

United States Code, as may be necessary in carrying out the programs for the current fiscal 

year for the Corporation: Provided further, That of the amount provided— 

(1) $133,677,000 shall remain available until September 30, 2023, for

administrative expenses to carry out authorized activities (including an amount

for official reception and representation expenses which shall not exceed

$35,000) and project-specific transaction costs as described in section 1434(k)

of such Act, of which 5 percent shall remain available until September 30,

2025;

(2) $700,000,000 shall remain available until September 30, 2023, for the

activities described in subsections (b), (c), (e), (f), and (g) of section 1421 of the

Build Act of 2018, except such amounts obligated in a fiscal year for activities

described in section 1421(c) of the Build Act of 2018 shall remain available for

disbursement for the term of the underlying project: Provided further, That if the

term of the project extends longer than 10 fiscal years, the Chief Executive

Officer of the Corporation shall inform the appropriate congressional

committees prior to the obligation or disbursement of funds, as applicable:

Provided further, That amounts made available under this subparagraph may be

paid to the "United States International Development Finance CorporationProgram Account" for the activities described in subsections (b), (e), (f), and (g)

of section 1421 of the BUILD Act of 2018:

Provided further, That funds may only be obligated pursuant to section 1421(g) of the 

BUILD Act of 2018 subject to the regular notification procedures of the Committees on 

Appropriations: Provided further, That in this fiscal year, and each fiscal year thereafter, 

the Corporation shall collect the amounts described in section 1434(h) of the BUILD Act 

of 2018: Provided further, That in fiscal year 2021 such collections shall be credited as 

offsetting collections to this appropriation: Provided further, That such collections 

collected in fiscal year 2021 in excess of $833,677,000 shall be credited to this account 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 19 
 

 

 

 

 

and shall be available in future fiscal years only to the extent provided in advance in 

appropriations Acts: Provided further, That in fiscal year 2021, if such collections are less 

than $833,677,000, receipts collected pursuant to the BUILD Act of 2018 and the 

Federal Credit Reform Act of 1990, in an amount equal to such shortfall, shall be 

credited as offsetting collections to this appropriation: Provided further, That funds 

appropriated or otherwise made available under this heading may not be used to provide 

any type of assistance that is otherwise prohibited by any other provision of law or to 

provide assistance to any foreign country that is otherwise prohibited by any other 

provision of law: Provided further, That the sums herein appropriated from the General 

Fund shall be reduced on a dollar-for-dollar basis by the offsetting collections described 

under this heading so as to result in a final fiscal year appropriation from the General 

Fund estimated at $337,677,000. 

Program Account

Amounts paid from "United States International Development Finance Corporation 

Corporate Capital Account" (CCA) shall remain available until September 30, 2023: 

Provided, That amounts paid to this account from CCA or transferred to this account 

pursuant to section 1434(j) of the BUILD Act of 2018 (division F of Public Law 115–254) 

shall be available for the costs of direct and guaranteed loans provided by the Corporation 

pursuant to section 1421(b) of such Act: Provided further, That such costs, including the 

cost of modifying such loans, shall be as defined in section 502 of the Congressional 

Budget Act of 1974: Provided further, That such amounts obligated in a fiscal year shall 

remain available for disbursement for the following 8 fiscal years: Provided further, That 

funds transferred to carry out the Foreign Assistance Act of 1961 pursuant to section 

1434(j) of the BUILD Act of 2018 may remain available for obligation for 1 additional fiscal 

year: Provided further, That the total loan principal or guaranteed principal amount shall not 

exceed $10,000,000,000. 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 20 
 

 

 

 

 

 

 

 

 

 

Appendix B: Fiscal Year 2019 in Review 

Overseas Private Investment Corporation (OPIC)

2X: Invest in Women. Invest in the World 

OPIC surpassed initial targets to catalyze $1 billion to global women’s economic 

empowerment through its 2X Women’s Initiative.

OPIC’s 2X Women’s Initiative aimed to unlock the multi-trillion dollar opportunity 

women represent by catalyzing investment in projects that support the world’s women. 

As part of the initiative, OPIC committed to mobilizing $1 billion to business and funds 

owned by women, managed by women, or providing a product or service that 

intentionally empowers women. OPIC also accepted the 2X Challenge alongside peer G7 

development finance institutions to collectively catalyze $3 billion to the world’s women. 

Under the 2X Africa Initiative, DFC continues OPIC’s work to unlock the full economic 

potential of women in Africa by catalyzing $1 billion, directly investing $350 million, to 

businesses and funds owned by women, led by women, or providing a good or service 

that intentionally empowers women on the continent. 

How DFC is Investing in Women 

As part of a new Financing for MOMs (Maternal Outcomes Matters) Alliance, OPIC, 

USAID, Merck, through its Merck for Mothers Initiative, and Credit Suisse signed a 

memorandum of understanding with the goal of mobilizing up to $50 million to improve 

and expand infrastructure, services, and access to care in Sub-Saharan Africa. The 

collaboration will help more women receive high quality care to ensure a healthy 

pregnancy and safe delivery, and lay the foundation for life-long good health. 

OPIC, along with IDB Invest, launched Fund Mujer—a $200 million gender-focused fund 

for Latin America and the Caribbean. The aim of the fund is to narrow the gender 

financing gap by supporting investment strategies focused on women-owned 

businesses. 

Connecting Africa to the World 

Africa is a longstanding OPIC priority and accounts for more than one-quarter of OPIC’s 

global portfolio. The continent presents both a great need for investment in 

development and a significant opportunity for investors. In 2019, OPIC worked to 

extend its investment on the continent, making official visits to 10 countries to explore 

new projects. 

Connect Africa: In 2018, OPIC launched the Connect Africa Initiative, an effort to invest 

$1 billion dollars over three years in sectors that will foster economic growth and 

enhanced connectivity with global economies. In 2019, OPIC made several commitments 

under the Connect Africa Initiative that advanced important development objectives in 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 21 
 

 

 

 

 

 

 

 

 

 

the information and communications technology, manufacturing, and infrastructure 

sectors. For example, OPIC is providing insurance for the construction and operation of a 

port in Gabon and financing for the development and commercialization of a natural gas 

and helium field in South Africa. 

Providing Cleaning Water Access: A crucial desalination plant in Ghana was shuttered for 

several years. OPIC financing will be used for updates and important modernizations that 

will restart operations at the desalination plant and provide communities with access to 

clean water. 

Bringing Electricity to the Sahel: Currently, 64% of the population in the Sahel lacks access 

to electricity. The semi-arid region, with both savanna and desert landscapes, has 

struggled in attracting private sector investment because of the energy shortfall. OPIC 

committed financing to an off-grid electrification business in Chad that distributes and 

maintains solar home kits and appliances. 

Supporting the Agriculture Sector: Africa boasts more than half of the world’s total 

uncultivated arable land. Harnessing this land and helping the continent achieve a 

thriving agricultural sector is key for the region’s economic growth objectives and 

improving livelihoods. Recently, OPIC committed financing to the One Acre Fund, a 

highly impactful social enterprise that provides small holder farmers with vital inputs that 

will increase crop yields. 

Achieving a Free and Open Indo-Pacific 

The 36 nations comprising the Indo-Pacific region are home to more than 50% of the 

world's population, 3,000 different languages, several of the world's largest militaries, 

and five nations allied with the US through mutual defense treaties, including Japan, 

Korea, Philippines, Thailand and Australia. The region is a vital driver of the global 

economy and includes the world's busiest international sea lanes and nine of the ten 

largest ports. Given these conditions, the strategic complexity of the region is unique, 

and the opportunities to mobilize private capital are vast. 

Priority Sectors: Based on consultations with 22 Federal entities, private sector partners, 

and civil society, OPIC identified digital economy, infrastructure, and energy as priority 

sectors for business development. This aligns with America's Indo-Pacific Economic Vision. 

OPIC staff spent FY 2019 working to execute this vision. Presently, over $1 billion of 

new projects are in the OPIC pipeline. 

OPIC Strategy: Developing countries in the Indo-Pacific need $1.7 trillion in infrastructure 

investment every year, according to the Asian Development Bank. OPIC strategy seeks 

to create the conditions to unlock private sector investment by driving transactions that 

are commercially motivated, transparent, and committed to international standards. 

The U.S. Government cannot achieve these development objectives alone. In FY 2019, 

OPIC signed the Trilateral MOU between Japan, Australia, and OPIC, and have since 

conducted combined business development missions to Philippines, Papua New Guinea, 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 22 
 

 

 

 

 

 

 

 

 

 

 

 

and Indonesia. These trips resulted in commitments and applications for projects from 

India to ASEAN to the Second Island Chain. OPIC also signed MOUs with Singapore’s 

Infrastructure Asia, and the Asian Development Bank DFC is presently working on an 

agreement with South Korea. 

Expanded presence in the region: During FY 2019, OPIC senior staff traveled to 11 IndoPacific nations. Engagement with key leaders, ministries, and partners has achieved 

significant results for investment in the three priority sectors, including: participation on 

a subsea cable project with Japan and Australia, using Taiwan’s technical assistance for 

an OPIC project in Paraguay, and ensuring that an investment in Subic Bay remained 

outside the grasp of authoritarian governments, maintaining a free and open South China 

Sea. 

OPIC at work in the Indo-Pacific 

Investing in businesses that serve poor communities in Southeast Asia: Navis Asia Fund VIII, 

L.P. invests into small and mid-market companies in Southeast Asia, focused on

education, healthcare, consumer goods, light industrial manufacturing, and business and

professional services. An OPIC commitment of $200 million to the fund will help

catalyze private investment into Southeast Asia and facilitate developmental

investments.

Investing in Clean Energy in India: ReNew Power Master Financing Facility II will provide 

$350 million of much needed long-term debt capital to enable ReNew to build a major 

pipeline of solar energy projects under the National Solar Mission (“NSM”) in India, wind 

energy projects under national level tenders, and solar and wind energy projects with 

select state distribution companies. 

Investing in Digital Human Capital: Digital Divide Data, financed under the Scaling 

Enterprise Loan Guaranty Facility, trains and employs disadvantaged populations, 

including low-income young people in Cambodia, Laos, and Kenya in order to provide 

them with valuable skills and job experience which can be used for advancing their 

careers. 

Investing in Women Farmers : Proximity Finance focuses on agricultural clients in rural 

areas, one of the few micro finance institutions active in the Delta, Dry Zone, and 

Uplands areas, which have limited or no access to formal financing. The OPIC loan is 

expected to reach approximately 20,000 rural borrowers, primarily women, and once 

fully disbursed several multiples of that over five-year life of the loan. The loans will 

increase agricultural capacity and production leading to more sustainable and consistent 

output to the local market. 

Extending a longstanding commitment to our neighbors to the South 

The Western Hemisphere accounts for more than $5 billion of DFC’s current $22.8 

billion portfolio, representing more than 25% of the total portfolio. Our neighbors to the 

south are important partners with significant development needs. They have significant 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 23 
 

 

 

 

 

 

 

 

 

needs in energy, infrastructure, and access to finance for women. These countries have 

had to grapple with changes in leadership due to recent elections in most countries in 

the region and sweeping reforms as a result of corruption scandals. OPIC’s support for 

credit worthy development projects provided a stabilizing force that served to catalyse 

much needed private investment in the region. 

• In 2019, OPIC committed over $1.5 billion to 29 new deals in more than

11 countries in Latin America.

• OPIC supported the U. S. Government’s December 2018 agreement with

Mexico with an intent to finance $2 billion in south of Mexico. To that end,

OPIC signed $720 million in letters of intent in July 2019 to support

energy projects in the southern part of the country.

• OPIC has developed a robust pipeline of infrastructure and energy

projects, which are GDP multipliers.

Some notable projects from 2019 include: 

• Mexico: Since December 2018, OPIC has committed $52 million in

financing to expand access to growth capital for micro, small, and medium

enterprises (MSMEs), particularly female entrepreneurs, in southern

Mexico.

• Brazil: A $350 million OPIC loan supported the development of Brazil’s

first private oil transshipment port at the Açu Port in Rio de Janiero, which

has provided a safer and more cost-effective solution for transferring the

country’s offshore oil reserves.

• Paraguay: OPIC committed $138 million in financing to Banco Regional

which is on-lending at least one third of the proceeds to women or women

led SMEs.

• Argentina: In April 2019, OPIC approved $45 million in financing to help

Plaza Logistica expand five warehousing facilities in Argentina that will

spur economic growth by strengthening the country’s supply chain

infrastructure.

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 24 
 

 

 

 

 

 

 

Development Credit Authority (DCA) 

The majority of DCA’s FY 2019 activities fell within four broad strategic priorities: 

• Investing in Women’s Economic Empowerment

• Mobilizing Finance for Energy and Infrastructure

• Increasing Access to Finance in the Indo-Pacific Region

• Supporting Environmental Protection and Conservation

Investing in Women’s Economic Empowerment 

USAID entered into a $100 million 50 percent loan portfolio guarantee in support of the 

Women’s Livelihood Bond 2 debt security, which is structured and managed by Impact 

Investment Exchange (IIX). The guarantee will be used for lending to microfinance 

institutions (MFIs) and impact enterprises across South and Southeast Asia and the 

Pacific Islands, including Bangladesh, Cambodia, Fiji, India, Indonesia, Nepal, Papua New 

Guinea, Philippines, Solomon Islands, Sri Lanka, Thailand, and Vietnam. These borrowers 

will focus on women’s livelihoods, including economic sectors especially accessible to 

women, such as, clean energy and sustainable agriculture. In many countries across Asia, 

women and girls continue to face structural constraints that trap them in subsistence 

livelihoods, such as limited access to credit, knowledge and skills, affordable goods and 

assets or reliable and affordable power supply. These constraints reduce their resilience 

to economic and environmental downturns and compromise holistic economic 

development. This guarantee will directly address this issue by allowing women to 

benefit—directly and indirectly—from long-term financing raised through capital markets. 

As a result of this guarantee, approximately 1.5 million underserved or socially 

disadvantaged women across South and Southeast Asia and the Pacific Islands will have 

improved access to credit and improved livelihoods within the targeted sectors. 

In Tanzania, USAID partnered with Amana Bank to support new lending to the agriculture 

sector, with a specific focus on youth and women borrowers. The 50 percent loan 

portfolio guarantee will directly support USAID/Tanzania’s development objectives of 

improving access to private lending in the Southern Agricultural Growth Corridor of 

Tanzania (SAGCOT) and Zanzibar regions, which are the focus of USAID/Tanzania food 

security and agricultural programming. Borrowers under this proposed guarantee will be 

individual farmers, cooperatives, and micro-, small-, and medium-sized enterprises 

(MSMEs) operating in the SAGCOT and Zanzibar regions. The agriculture sector receives 

only 9 percent of all lending in Tanzania despite making up more than 25 percent of GDP 

and 75 percent of employment. The sector is hampered by a number of issues, 

specifically low productivity and poor infrastructure. Additionally, very little value is 

added to the agricultural commodities produced in Tanzania within the country itself. 

These issues are all strongly correlated with a lack of financing and are especially acute 

in the SAGCOT and Zanzibar regions, as well as, with youth and women entrepreneurs. 

As a result of the guarantee, approximately 500 borrowers will receive access to 

financing, and more financial institutions will provide products and services within the 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 25 
 

 

 

SAGCOT region, reaching underserved communities and increasing access to finance. 

Mobilizing Finance for Energy and Infrastructure 

USAID provided a 50 percent bond co-guarantee alongside Infrastructure Credit 

Guarantee Company Limited (InfraCredit), a Nigerian guarantor of private company bonds. 

The bond issuer is a local enterprise and will use the proceeds to unlock stranded 

electricity generation at a site in Port Harcourt, Nigeria and hedge its currency exposure 

by refinancing a portion of its foreign currency debt into local currency. This bond 

guarantee directly supports USAID/Nigeria’s development strategy to improve the 

business environment, including access to finance for infrastructure. InfraCredit, as the 

entity that is sharing with USAID the repayment risk of the bond, will be USAID’s risksharing partner. 

Currently, commercial debt markets in Nigeria do not offer the long-term financing 

required to make infrastructure investment commercially viable. Additionally, bond 

market investors in Nigeria typically will not purchase quality bond issuances on their 

own merits. One potentially promising source of investment in local currency private 

corporate bonds is local pension funds. However, these funds only commit a fraction of 

a percentage into such bonds even though regulations allow them to commit up to 15 

percent of assets. Today, they are only willing to purchase such bonds when they receive 

additional guarantees, guidance and capacity building. 

This co-guarantee will provide the assurance that these bond holders need in order to 

purchase the bonds. It will also be an additional step towards the future where local 

pension funds and other institutional investors are comfortable evaluating and investing 

in such bonds without a guarantee. The co-guarantor, InfraCredit, will receive technical 

assistance, potentially in the area of training pension fund investors from the USAID 

Nigerian Power Sector Program. As a result of this guarantee, there will be increased 

long-term local currency finance for infrastructure in Nigeria, and additional capacity for 

local pension funds to invest in their own country. 

USAID, in collaboration with Power Africa, extended a 50 percent loan portfolio 

guarantee to support new lending from a local non-banking financial institution, General 

Trade Finance, to off-grid energy activities in Somalia. Borrowers under the guarantee will 

be energy projects that will install solar mini-grids to increase renewable electricity 

generation for consumption by households and businesses. Currently, only 16 percent of 

Somalis have regular access to electricity. Additionally, all electricity in the country is 

privately provided and heavily reliant on expensive diesel generation. The guarantee will 

directly address this issue by facilitating financing for the construction and installation of 

solar mini-grids allowing the generated electricity to be used for productive uses, 

including distribution in larger urban areas and specific businesses. These off-grid energy 

projects will receive technical support from one or more of Power Africa’s local technical 

assistance programs. As a result of this guarantee, it is estimated that the lender will 

increase electricity generation in Somalia by approximately 4.5 megawatts, as well as 

demonstrate the viability of investing in Somalian projects. 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 26 
 

 

 

USAID, in collaboration with State’s Bureau of Western Hemisphere Affairs, provided a 

50 percent loan portfolio guarantee to National Commercial Bank Jamaica to incentivize 

lending in the energy and small- and medium-sized enterprise (SME) sectors across the 

Caribbean. The guarantee will directly support the State’s Caribbean Energy Security 

Initiative (CESI), which seeks to boost energy security and sustainable economic growth 

in the region by attracting investment in a range of energy technologies through a focus 

on improved governance, increased access to finance, and strengthened coordination 

among energy donors, host governments, and stakeholders. 

Borrowers under the guarantee will be individuals, households, SMEs, companies, and 

municipalities investing in renewable energy, energy efficiency, energy-efficient and 

renewable energy mortgages, and other energy savings opportunities as well as SMEs 

who have received energy efficiency information. The guarantee will cover loans for 

non-oil energy projects such as clean energy and energy saving projects, retrofits for 

manufacturing equipment, assembly of energy-efficient technologies, renewable energy 

production, and small-scale hydropower projects throughout the Caribbean region. The 

region currently relies heavily on imported oil for power generation. Oil price volatility 

combined with increasing energy demand strains regional economic growth and results 

in high electricity costs for residents. Alternative sources of energy, such as natural gas 

or renewable energy sources, combined with energy efficiency measures, could help 

Caribbean countries reduce energy costs, enhance energy security, and facilitate 

economic development and investment. 

Increasing Access to Finance in the Indo-Pacific Region 

In India, USAID established two guarantee partnerships, a 50 percent loan portfolio 

guarantee with Caspian Impact Investments, and a second 50 percent loan portfolio 

guarantee with Svakarma and IndusInd. The guarantees will directly support 

USAID/India’s development objectives of impacting lives at the base of the pyramid and 

accelerating India’s transition to a low emissions economy. 

Borrowers supported under the guarantees will be operating in two primary sectors: 1) 

private enterprises operating in the water, sanitation and hygiene (WASH) sector serving 

base of the pyramid clients; and 2) enterprises operating in the renewable energy and 

energy efficiency sector, including SMEs in the manufacturing and non-manufacturing 

sectors delivering modern energy services, such as rooftop solar, solar pumps, biomass 

based technologies, efficient appliances, battery storage strategies, and e-vehicles for 

unserved and underserved populations. 

WASH enterprises include companies operating in the water provision, water quality, 

toilet manufacturing, and waste management sub-sectors. Over 600 million Indians lack 

basic water and sanitation facilities; the water and sanitation sector requires investments 

of $40 billion over 15 years, offering a large opportunity to companies. 

In addition, most countries in South Asia face a common set of challenges that hinder 

achieving the fundamental goal of economic, reliable, accessible, and environmentally 

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secure energy for all. These guarantees aim to establish the WASH sector as a bankable 

sector of the economy, with projects and entities that generate enough cash to pay back 

a loan. Consistent with the U.S. Government’s Indo-Pacific Strategy, USAID/India, 

through the Asia Enhancing Development and Growth through Energy (EDGE) initiative, 

is promoting market-based approaches to energy security challenges. Both WASH and 

renewable energy/energy efficiency sectors will receive technical assistance, which will 

be focused on building a larger pipeline of bankable companies and projects. 

Supporting Environmental Protection and Conservation 

USAID entered into a 50 percent loan portfolio guarantee with The Ocean Fund, an 

investment fund managed by Circulate Capital that will lend to companies in the 

recycling value chain. The guarantee will directly support USAID’s development 

objective to reduce global ocean plastic waste. Borrowers under this proposed guarantee 

will be collection, sorting, recycling, and manufacturing enterprises throughout South 

and Southeast Asia. This guarantee will focus on improving the overall recycling value 

chain to reduce plastic waste flowing into the ocean. An estimated eight million tons of 

plastic waste stream into the ocean every year due to poor waste management. Eighty 

percent of marine litter worldwide is coming from land-based sources. With rapid 

population growth and urbanization, municipal waste generation is expected to rise to 

2.2 billion tons per year by 2025. In Asia, investment in infrastructure and waste 

management needs to nearly double in order to reach waste collection targets. As a 

result of the guarantee, the investment fund will provide loans to an estimated 15 

companies in the recycling value chain where capital is needed to build infrastructure to 

address the problem. 

USAID partnered with Althelia Funds, an impact investor, in support of new lending to 

conserve biodiversity and mitigate deforestation in the Brazilian Amazon. The loan 

portfolio guarantee will directly support USAID/Brazil’s development objective of 

increasing biodiversity in the Brazilian Amazon. Borrowers under the guarantee will 

include SMEs, cooperatives, associations, non-governmental organizations, and other 

entities engaged in private sector projects that improve biodiversity and sustainable 

forest management in the region. Loans will be repaid using revenues from sustainable 

businesses that improve land management and reduce deforestation. Currently, the 

expanding agricultural frontiers, along with unsustainable and illegal logging, threaten 

Brazil’s tropical forests and rich biodiversity. Indigenous and other forest-dependent 

communities living in the Brazilian Amazon help conserve these forests through a 

combination of sustainable agriculture and forest-based enterprises, such as harvesting 

açai berries and Brazil nuts. However, without increased access to formal financial 

services, these businesses cannot compete with burgeoning unsustainable and illegal 

activities. In addition, producers adjacent to protected areas threaten forests through 

intensification of agriculture, cattle ranching, and illegal activities. This guarantee will 

directly address these issues by encouraging lending to businesses that are perceived as 

high-risk and operating in hard-to-reach areas of the Brazilian Amazon that support 

CONGRESSIONAL BUDGET JUSTIFICATION FISCAL YEAR 2021 28 
 

biodiversity and forest conservation activities and practices. The lender will provide 

technical assistance to its borrowers in the form of investment guidance in an effort to 

foster the creation of profitable, environmentally-friendly businesses. As a result of this 

guarantee, it is anticipated that 20 new conservation-focused businesses will receive 

financing. 

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Appendix C: BUILDing DFC—Transition Timeline 

• Nearly 18 months ago, the President signed into law the Better Utilization

of Investments Leading to Development (BUILD) Act. In the time since the

enactment of the BUILD Act, OPIC and USAID have been working

together with the goal of opening the doors of the U.S. International

Development Finance Corporation (DFC). Much has been accomplished

and much remains to be done to fulfill the intent of the BUILD Act.

• Soon after the enactment of the BUILD Act, OPIC management began to

identify key issues that would need to be addressed to complete this

transition and to develop detailed plans for transformation of the legacy

OPIC and DCA organizations.

• Key external stakeholder groups including members of the private sector,

development community, foreign policy experts, and OPIC alumni were

consulted for their views on how to optimize DFC’s efficiency and

effectiveness.

• Plans and timelines were developed to implement the changes necessary

to complete the transition to DFC.

• An interagency process began which included consultations with the U.S.

Agency for International Development (USAID), the National Security

Council (NSC), Millennium Challenge Corporation (MCC), State, the Office

of Management and Budget (OMB), and others to refine the plans for DFC,

to ensure that foreign policy coordination was considered and captured

fellow agencies’ views on topics ranging from Low Income and Low Middle

Income Countries (LICs and LMICs) prioritization to development impact

mechanisms.

• On March 8, 2019 the President submitted a reorganization plan to

Congress, as required by the BUILD Act.

• DFC held its first Board meeting on June 12, 2019 to pass the corporate

governance documents and delegate authority to OPIC’s acting President

and CEO as acting agency-head of DFC.

• A DFC Transition Program Management Office (PMO) team representing

all departments of OPIC and DCA was put in place to drive the transition

and to identify and resolve critical issues.

• On July 31, 2019, a Report on Coordination between OPIC and USAID was

sent to Congress, as required by the BUILD Act.

• On December 20, 2019, enactment of DFC’s first appropriation.

• February 18, 2020 marked the end of the Transition Period (60 days after

enactment of appropriation).

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