Report of the

OVERSEAS PRIVATE INVESTMENT CORPORATION

ANNUAL REPORT

ON DEVELOPMENT IMPACT

FISCAL YEAR 2019

Submitted Pursuant to

Section 240A of the

Foreign Assistance Act of 1961,

As Amended

September 2020
OVERSEAS PRIVATE INVESTMENT CORPORATION

Table of Contents

Development Impact Overview 3

Supporting the U.S. Economy and Businesses 5

OPIC’s Internal Procurement Activities 5

Environmental, Health, and Safety 7

Project Screening and Assessment 7

Rejected Transactions 7

Greenhouse Gas Reporting 7

Social Assessment: Labor and Human Rights 9

Project Screening and Assessment 9

Rejected Transactions 9

Portfolio Monitoring and Evaluation 10

Compliance with OPIC Conditions and Covenants 11

Exhibits 12
OVERSEAS PRIVATE INVESTMENT CORPORATION

A note about this report

The 2019 Annual Policy Report is the final report of the Overseas Private Investment Corporation. 

In December 2019, the U.S. International Development Finance Corporation (DFC) launched as a new agency of the 

U.S. Government, which modernized and expanded the tools of OPIC. DFC incorporates the portfolios of OPIC, along 

with those of the Development Credit Authority, which was previously a part of the U.S. Agency for International 

Development.

Going forward, DFC will report on its project monitoring activities and development impact under the requirements 

outlined in the Better Utilization of Investments Leading to Development (BUILD) Act of 2018, the legislation that 

created DFC. As part of our commitment to supporting developmental projects that deliver tangible benefits to 

people in developing countries, DFC has developed a new measurement tool called Impact Quotient, or IQ, to 

evaluate the likely impact of a project from the time it is initially screened, measure the impact throughout the life 

of the project, and report this data to key stakeholders. 



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strategic goals. Through contracting and outreach activities as part of OPIC’s 2X initiative, OPIC has

substantively contributed to empowering women to spur economic growth and advancing entrepreneurship 

to support underrepresented American businesses.

disadvantaged. All individuals must have a net worth of less than $750,000, excluding the equity of the 

business and primary residence.
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ENVIRONMENTAL, HEALTH, AND SAFETY 

Project Screening and Assessment

OPIC screens all potential projects to identify the risk of adverse environmental, health, or safety impacts, 

and to identify project impacts that could preclude OPIC support. For a project determined to be 

categorically ineligible,9 OPIC immediately informs the applicant to avoid unnecessary effort or expense on 

their part. If the project is eligible, OPIC categorizes the project to determine the requirements for 

documentation, disclosure, consultation, reporting, and post-commitment monitoring. Projects may be 

categorized as A, B, C, or D depending on their potential risks and impacts. 

Category A projects present the greatest potential for adverse environmental and/or social impacts, whereas 

Category C projects represent the least potential for adverse impact. Category D is reserved for certain 

projects involving financial intermediaries that make investments in or provide financing to projects or 

enterprises engaged in activities within Categories A, B, or C (“Subprojects”). OPIC screens, reviews, and 

provides prior written consent to Subprojects on the basis of potential environmental and social risks.

In 2019, nine of the 82 projects OPIC committed to support were screened as Category A, which have the 

potential for significant adverse environmental and/or social impacts without adequate mitigation 

measures. Given these risks, OPIC requires all Category A projects to have a full environmental and social 

impact assessment (ESIA). 

Rejected Transactions

OPIC works diligently to ensure that its policies regarding environmental, health, and safety are well 

understood upfront. 

1. Before formal applications are submitted, OPIC endeavors to advise clients regarding project plans 

that could be problematic from an environmental, health, or safety perspective

2. In some cases, clients are able to modify projects to mitigate risks appropriately

3. In other cases, they may withdraw the request for OPIC support

As a result, OPIC did not need to reject any applications for finance or insurance on environmental, health,

or safety grounds, in 2019.

Greenhouse Gas Reporting10

OPIC gathers data on the greenhouse gas (GHG) emissions related to its portfolio. OPIC has committed to: 

(a) reducing the direct GHG emissions from projects in its active portfolio (using the calendar year 2007 

direct GHG emissions from OPIC’s active portfolio on June 30, 2008 as a baseline), by (i) 30% over a ten-year 

period and (ii) 50% over a 15-year period; and (b) increasing investment support to renewable energy and 

energy efficiency projects. “Direct emissions” are defined as the result of the combustion of fuel by OPICsupported projects.

Since FY2008, the aggregate direct GHG emissions associated with projects in OPIC’s active portfolio 

decreased by approximately 40.88 million short tons of CO2e from 49.77 million short tons of CO2e in 

9 Certain categories of projects have potential adverse environmental or social impacts that preclude the 

project from receiving OPIC support. Projects in these prohibited categories are listed in Appendix B of OPIC’s 

Environmental and Social Policy Statement.

10 For more information on OPIC’s GHG Accounting Reports, visit: 

https://www.dfc.gov/media/reports/archived
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calendar year 2007 to approximately 8.89 million short tons in calendar year 2018. This represents an 82.1% 

reduction in portfolio emissions.11

11 In the FY2014 Annual GHG Report, OPIC corrected its FY2008 baseline to remove GHG emissions that were 

earmarked for the Latin America Power (LP) III Fund. In FY2014, LP III became fully invested without having 

invested in any projects that were significant GHG sources. Therefore, OPIC decided to retroactively remove 

the LP III allocation from the FY2008-2013 inventories (including the FY2008 baseline).
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SOCIAL ASSESSMENT: LABOR AND HUMAN RIGHTS 

Project Screening and Assessment

OPIC implements policies consistent with its statutory requirements related to social risk identification and 

management, including respect for human rights and the rights of workers. OPIC screens all potential 

projects for eligibility based on labor and human rights criteria.

12 If a potential project is not categorically 

prohibited, it undergoes a full review for social risks. 

In 2019, none of the 82 projects OPIC committed to support were reviewed and classified as “Special 

Consideration.” Projects with significant adverse social impacts or those being developed in regions with 

recent conflict, compromised regulatory systems, or the presence of vulnerable groups such as large 

numbers of contracted workers or Indigenous Peoples may qualify for Special Consideration. This 

designation requires additional oversight in the form of an independent audit, a project site visit, and annual 

reporting for projects with a heightened potential for social risks, including labor or human rights violations.

In cases where the overall environmental and social categorization (described above) captures these risks, 

Special Consideration may not be applied.

OPIC consults with the U.S. Department of State Bureau for Democracy, Human Rights, and Labor (DRL) on 

this review to ensure consistency between OPIC and DRL regarding relevant human rights matters in OPIC 

eligible countries.

OPIC uses its social assessment to evaluate the potential risks to workers at the project or to other people 

or groups potentially impacted by project activities, and to identify means to improve the project by 

preventing and minimizing such risks as a condition of OPIC support. The process includes the following:

Identification of potential risks to project-affected people, including individuals, workers, 

groups or local communities 

Comparison of the project’s expected performance in relation to internationally-accepted 

standards and practices

Evaluation or design of project requirements necessary to enable OPIC support

Evaluation or design of associated management and monitoring measures

Rejected Transactions

OPIC works diligently to ensure that its policies regarding social risks, including those concerning labor rights 

and human rights, are well understood. Before formal applications are submitted, OPIC advises potential 

clients on projects that are potentially problematic from a social perspective. 

1. Before formal applications are submitted, OPIC endeavors to advise clients regarding project plans 

that could be problematic for labor or human rights risks

2. In some cases, clients are able to modify projects to mitigate risks appropriately

3. In other cases, they may withdraw the request for OPIC support

As a result, in 2019, OPIC did not have to reject any applications for finance or insurance on social grounds. 

12 Country eligibility for OPIC-supported projects based on labor-related statutory obligations is found in 

Exhibit 3 of this report and also in Chapter 9 of the OPIC Environmental and Social Policy Statement, available 

on OPIC’s website.

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Compliance with OPIC Conditions and Covenants

Social Assessment

Social assessment monitoring activities focused on 42 projects with the potential for greatest social risk. One 

project was visited twice. During site monitoring, eight projects were found to be out of compliance with 

OPIC’s covenants regarding labor conditions or social risk management. For these eight projects, OPIC 

developed a corrective action plan to address the areas of non-compliance. Non-compliances were primarily 

associated with appropriate oversight of working conditions, external communication and mechanisms for 

grievance redress, and ensuring appropriate compensation for land affected by project activities.

Environment, Health and Safety

The Environmental group focused on projects with the greatest environmental, health, or safety risks. The 

environmental group monitored 35 distinct projects in 2019. Eight of these projects were Category A, 23 

were Category B, two projects were Category C, and one was Category D. There was one Category A project 

that was visited twice. Twelve projects were found to be in material noncompliance with OPIC covenants 

and conditions pertaining to environmental considerations.

Development Impact

Of the 13 projects visited and evaluated for their economic development impact14:

• Five projects that were initially rated Developmental kept their rating;

• Three projects that were initially rated Highly Developmental kept their rating;

• Four projects that were initially rated Developmental had their rating increased to Highly 

Developmental.

14 One project initial rated Developmental was not rated during monitoring.
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EXHIBITS

Exhibit 1: U.S. Employment and Associated Effects of OPIC-Supported Projects....................................... 13

Exhibit 2: Destination of Sales to Third-Party Markets............................................................................... 14

Exhibit 3: Methodology for Calculating U.S. Employment Effects.............................................................. 15

Exhibit 4: OPIC’s Development Matrix ........................................................................................................ 16

Exhibit 5: Country Eligibility ........................................................................................................................ 17

Exhibit 6: OPIC’s Site-Monitoring Methodology ......................................................................................... 18

Exhibit 7: Projects Monitored by OPIC’s Office of Investment Policy in 2019............................................. 19

Exhibit 8: Projects Monitored for Development Impact in 2019................................................................. 21

Exhibit 9: Projects Monitored for Environmental Impact and Social Evaluation in 2019 ........................... 22
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Exhibit 1: U.S. Employment and Associated Effects of OPIC-Supported Projects15

FY 2019 (Projections)

Employment and associated effects are aggregated over first five years of project operation

Effect on 

Employment

Number of

Projects Final Destination of Project Output U.S.Procurement

Effect on U.S.

Employment

Effect on U.S.

Trade Balance

Host Country U.S. 3rd Country

Positive16 9 $382,596,587 $0 $445,461,725 $154,832,188 289 -90,032,535

Neutral17 73 $1,283,705,239 $3,430,000 $56,443,730 $1,100,000 <1 -$73,980,000

Negative18 0 $0 $0 $0 $0 0 $0

Total 82 $1,666,301,826 $1,944,050,892 $501,905,455 $155,932,188 289 -164,012,535

15 Foreign Assistance Act of 1961 (P.L.87-195), Sec. 240A(2)(b)

16 "Positive" effect on U.S. employment includes projects with more than two jobs (greater than ten person-years of employment during the first five years of project operation).

17 "Neutral" effect on U.S. employment includes projects with two or fewer jobs (ten person-years or fewer of employment during the first five years of project operation).

18 No OPIC-supported projects in 2019 expect loss of U.S. employment.
OVERSEAS PRIVATE INVESTMENT CORPORATION

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Exhibit 2: Destination of Sales to Third-Party Markets

FY 2019 (Projections)*

Third party annual sales over first five years of project operation

Country Third-Party Sales19

Projects with Positive Effect on Employment20

Global $445,461,725

Positive Subtotal $445,461,725

Projects with Neutral Effect on Employment21

Global $55,516,482

Hong Kong $72,000

Japan $19,048

Philippines $72,000

South Korea $59,628

Switzerland $28,572

Thailand $72,000

United Arab Emirates $72,000

United Kingdom $72,000

Neutral Subtotal $56,443,730

Projects with Negative Effect on Employment22

Negative Subtotal $0

Grand Total (All Projects) $501,905,455

19 "Third party" refers to countries that are neither the U.S. nor the host country.

20 "Positive" effect on U.S. employment includes projects with more than two jobs (greater than ten person-years of 

employment during the first five years of project operation).

21 "Neutral" effect on U.S. employment includes projects with two or fewer jobs (ten person-years or fewer of 

employment during the first five years of project operation).

22 No OPIC-supported projects in 2019 expect loss of U.S. employment.
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Exhibit 3: Methodology for Calculating U.S. Employment Effects

Each project seeking OPIC support is individually reviewed to estimate the potential impact on employment in the 

United States. OPIC uses procurement estimates provided by the investor to calculate expected initial and 

operational procurement from the United States (by value and specific type of good or service). The U.S. 

employment figure is generated by estimating a project’s initial procurement, as well as its five-year operational 

procurement of goods and services. OPIC considers both the direct and indirect employment necessary to produce 

those goods and services. Therefore, the employment effects incorporate the direct employment necessary to 

produce the procured goods and services, as well as the indirect employment required to produce the associated 

intermediate inputs. 

OPIC details each type of U.S. good or service expected to be procured for each project and, using industry-specific 

data from the U.S. Bureau of Labor Statistics (BLS), calculates the employment effect in that industrial sector as well 

as, in the sectors that supply necessary components or inputs. By using this standard employment effect 

methodology, OPIC is able to ascertain employment generation with greater precision than if it used an average for 

all U.S. exports. By including indirect effects, OPIC’s employment figures present a more accurate picture of the 

benefits accruing to U.S. workers from the anticipated procurement of goods and services by OPIC-supported 

projects. Finally, to confirm employment effect estimates, OPIC monitors actual economic effects after project 

start-up and throughout the life of OPIC’s involvement with the project. OPIC’s monitoring is described in further 

detail in the Monitoring section of this report. 
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Exhibit 4: OPIC’s Development Matrix 

As the U.S. Government’s development finance institution, OPIC seeks to support projects that will produce strong 

positive developmental impact. While many of the direct benefits of these projects are clear from the start, these 

projects often produce indirect benefits including associated job creation, increased host country tax revenue and 

the related procurement of local goods and services. 

Every proposed project is evaluated and scored based on a scale of 1 to 100. A project must score at least 25 points 

on the matrix to be considered developmental and clearly eligible for OPIC support. A score of over 60 qualifies a 

project as highly developmental. OPIC scores projects using two matrices — one tailored for financial services 

projects and the other for all other projects. Both matrices are comprised of the following five broad categories that 

measure a project’s developmental impact, regardless of the project’s industry, sector or the host country’s level of 

development:

• Development Reach: measures a project’s impact on basic infrastructure and/or its potential benefits to 

the poor and other underserved populations. For projects involving financial services, this factor measures 

the extent to which underdeveloped areas or underserved populations will be targeted by the financial 

institution.

• Environmental and Community Benefits: assesses a project’s improvement of the environment and any 

philanthropic activities that benefit the local community.

• Job Creation and Human Capacity Building: includes the number of new jobs to be created, as well as 

training and employee benefits that go beyond local legal requirements. 

• Host Country Macroeconomic or Financial Benefits: measures local procurement and fiscal and foreign 

exchange impacts. For projects involving financial services, this factor measures the amount of funds to be 

disbursed, as well as the impact on micro, small, and medium-sized enterprises, entrepreneurship, and 

home ownership.

• Demonstration Effects: includes technology and knowledge transfer, technical assistance to suppliers or 

borrowers, the introduction of new products (including financial products), the project’s impact on 

regulatory and legal reform, and the adoption of internationally-recognized quality or performance 

standards.

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Exhibit 6: OPIC’s Site-Monitoring Methodology

Environment, U.S. Economic Impact, Labor, and Host Country Developmental Impact

OPIC performs comprehensive and integrated monitoring to evaluate the U.S. and host-country economic effects, 

as well as the environmental, social, health and safety, and general working conditions of the projects it supports. 

OPIC’s integrated project monitoring is designed to ensure that each project complies with statutory and contractual 

requirements in these areas. Project monitoring consists of site visits to projects, in addition to analysis of 

information submitted annually by investors in the form of an online Self-Monitoring Questionnaire (SMQ). Since 

1993, OPIC has required SMQs of all investors per the OPIC finance agreement or insurance contract.

Using a statistical sampling methodology combined with risk-based monitoring, OPIC identifies projects that staff 

from one or more disciplines will site-monitor. The projects selected for site-monitoring include: (1) a random sample 

of projects that have been active for five or more years and have not been monitored previously; (2) projects that 

are sensitive with respect to U.S. economic effects, labor or environment, social, health and safety issues; and (3) 

projects that fit in logistically with randomly selected or sensitive projects.

Labor

OPIC monitors projects for compliance with contractual worker rights requirements through a combination of annual 

reporting by companies as well as site visits to both random and selected samples of projects. OPIC targets its worker 

rights monitoring efforts toward countries and sectors with a higher potential for possible worker rights violations.

Certain areas of worker rights violations may be difficult to identify from a typical project site-monitoring visit. In 

those instances where OPIC determines further investigation is warranted, OPIC may employ trained and certified 

labor auditors to perform a full project audit. Auditors are often recruited locally, and those with a reputation for 

impartiality and credibility among both the labor and business communities are preferred. The auditors spend as 

much time as necessary to investigate potential violations thoroughly. At a minimum, an audit would include 

independent and confidential interviews with employees and management. Relevant entities such as government 

officials, knowledgeable local NGOs, and organized labor groups may also be interviewed. 

Environment, Social, Health, and Safety (E&S) 

With respect to E&S issues, projects selected for site-monitoring in a given year are prioritized based on 

environmental and social risk. Environmental and social risks depend upon several factors including project 

sensitivity, host country context, project-level environmental and social management systems, and investor 

experience in implementing projects of similar complexity. OPIC assesses the E&S performance of a project against 

applicable benchmarks including contract conditions, international standards and guidelines, and industry best 

practices. Factors included in the performance assessment include an evaluation of the project’s environmental and 

social management systems, the effectiveness of mitigation, including pollution controls in risk reduction, and the 

efficiency of the operations, including energy efficiency. Interviews with the local community are conducted where 

relevant.

U.S. Economic Impact

OPIC monitors projects for their actual impact on the U.S. economy, including the U.S. employment generation 

effects. OPIC ensures that projects do not negatively impact the U.S. economy. This analysis includes verifying levels 

of exports to the U.S. or other countries (if any), calculating the U.S. trade balance impact, and verifying compliance 

with any restrictions included in the OPIC loan agreement or insurance contract (e.g. restrictions on exporting to the 

United States. or significant U.S. export markets). 

Development Impact

Regarding host country development impact, OPIC conducts “deep dives” on a random selection of projects to 

compare actual results to original projections, collect more detailed and robust information on the development 

impacts of the projects it supports, inform effectiveness of OPIC’s development assessment tools and metrics, glean 

lessons to be learned that are communicated to the rest of the Agency, and make recommendations to improve 

development impacts of the project or future projects. These “deep dives” are in addition to the annual monitoring 

of development data collected using OPIC’s Self-Monitoring Questionnaire. 

*

*Information has temporarily been redacted, including to protect the safety of implementing partners.


*

*Information has temporarily been redacted, including to protect the safety of implementing partners.