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Press Release

Friday, September 22, 2006

U.S. Small Business Uses OPIC Insurance to Launch Housing Program in Tanzania

WASHINGTON, D.C. – A U.S. small business will use political risk insurance from the Overseas Private Investment Corporation (OPIC) to assist in the construction of 5,000 homes in major cities throughout Tanzania, serving as a model for companies considering investment in a country where 60 to 70 percent of urban residents live in unplanned areas lacking basic services.

OPIC will provide $12.4 million in insurance to Enterprise Homes Tanzania Limited, a joint venture partly owned by Enterprise Homes LLC of Andover, Massachusetts, for the development of several residential housing neighborhoods in Dar es Salaam and other major cities throughout Tanzania. Each residential neighborhood will consist of a cluster of single-family homes, located on a land plot situated within 20 miles of a city’s central business district; each development will include the installation of required infrastructure, including roads and utilities.

Sale of the resulting homes will target middle-income Tanzanians, for whom the project will also provide fee-based mortgage brokerage and origination services.

Options currently available to finance the purchase of housing in Tanzania are extremely limited: the majority of property owners acquire land through an informal system and then build homes based upon the availability of personal cash resources. Last year, the Tanzanian government began a program to survey and upgrade hundreds of thousands of plots in its major cities. The aim of the program is to officially recognize property rights and create security of tenure.

“This project can make an important contribution to the development of the housing sector of Tanzania, demonstrating to potential investors that the country’s transition to a standardized titling system will make it an attractive destination for their capital,” said OPIC President and CEO Robert Mosbacher, Jr. “OPIC is pleased to support a project with so many developmental benefits.”


OPIC is the U.S. Government’s development finance institution.  It mobilizes private capital to help solve critical development challenges and in doing so, advances U.S. foreign policy.  Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets catalyzing revenues, jobs and growth opportunities both at home and abroad.  OPIC achieves its mission by providing investors with financing, guarantees, political risk insurance, and support for private equity investment funds.

 

Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers. OPIC services are available for new and expanding business enterprises in more than 150 countries worldwide. To date, OPIC has supported nearly $200 billion of investment in over 4,000 projects, generated $74 billion in U.S. exports and supported more than 275,000 American jobs.