The United States’ newly established International Development Finance Corp. (DFC) is eyeing more investments in the Indo-Pacific, even as its top official on Wednesday said that Washington would not compete with China’s Belt and Road Initiative (BRI) in dangling money to gain influence in the region.
In a teleconference, DFC chief executive officer Adam Boehler explained that the agency used to be the Overseas Private Investment Corp. (Opic), which the US Congress later on modernized and merged with Usaid’s Development Credit Authority in line with the passage of the Better Utilization of Investments Leading to Development (Build) Act of 2018.
“In modernizing Opic, they’ve doubled the size of the agency. We went from $30 billion to $60 billion of investment. They’ve (Congress and US President Donald Trump) given the agency the ability to invest in equity projects, which is a third product to our portfolio. So DFC offers risk-free insurance to private companies; financing, via loans, to private companies, and equity investment in private companies, as well as private investment firms. And so our goal is to drive private investment in emerging countries and companies to benefit global development,” Boehler said.
After DFC officially became an entity just last month, Boehler this week traveled to Indonesia, Japan and Vietnam—“we wanted to come to the Indo-Pacific, and that’s because the region is critically important to the United States and critically important from an investment perspective,” he said.
“Our commitment to the Indo-Pacific—we have a very strong history here and, obviously, the President’s plan for a strong, open and free Indo-Pacific Region falls into what we want. You’ll see us very much active in this area.” Boehler said.
Specifically, Boehler said DFC was looking into “multibillion-dollar” commitments in the education, energy, health care, technology and women’s investment sectors across Indo-Pacific countries.
“These are all huge focus areas for us, mainly because we’ve heard they’re huge focus areas for the countries that we’re looking at partnering and making investments in,” Boehler said.
Asked if DFC intended to rival China’s BRI as a source of financing for Indo-Pacific countries’ big-ticket investments, Boehler replied: “DFC is not a response to one country or another. At the end of the day, I believe you have strength by playing your game, not somebody else’s game. And so I’m less concerned about what projects BRI and others do, and I’m more concerned with what we do.”
“There is no question DFC is meant to be a strong investment alternative for nations. I think what we represent versus other autocratic countries is a very significant focus on an individual country’s sovereignty and success. This is not about influence one way or the other, this is about a strong, sovereign country,” he added.
Further asked if the tensions between the United States and Iran would have impact on the business and investment environment in the Indo-Pacific region, Boehler said: “I think the President (Trump) has been clear in this regard that the administration has taken decisive, but also preventative, action here … I think taking action in a decisive and preventative way was a critically important action, and I think it lets us create a medium- to long-term environment where we can focus on investing, and not focus on responding to terrorist attacks, like we were just a week or two ago.”