Overseas Private Investment Corporation Press Release June 28 2007

Press Release

Thursday, June 28, 2007

OPIC LAUNCHES NETWORK TO EXPAND LENDING AND INSURANCE TO SMALL BUSINESSES

Enterprise Development Network draws 15 U.S. and international organizations

WASHINGTON, D.C. – Robert Mosbacher, Jr., president and CEO of the Overseas Private Investment Corporation (OPIC), today launched the Enterprise Development Network (EDN), a strategic alliance with the private sector that will greatly expand OPIC’s ability to provide financing and political risk insurance to micro-, small and medium-sized enterprises (MSMEs) doing business in developing countries.

Through the support of financial institutions, business consultants, associations, law firms and regional investment promotion agencies, EDN will ease MSMEs’ access to OPIC products and services. By empowering such private sector service providers, the network will result in more efficient, cost-effective delivery of services to American businesses.

EDN consists of three types of service providers:

EDN loan and insurance originators, which help MSMEs to prepare OPIC applications, enhance market strategies and draft or refine business plans;
EDN designated lenders, financial institutions which establish OPIC-backed lending facilities that provide loans to MSMEs or their affiliates for projects in OPIC-eligible countries; and
EDN advisers, specialists in particular business sectors and geographic areas who assist OPIC in credit underwriting and due diligence on OPIC-funded loans.

“EDN represents an important milestone for OPIC, a significant leap forward in the agency’s support for American small businesses,” Mosbacher said. “For U.S. small businesses, the Enterprise Development Network will improve access to the kind of credit for overseas projects that is often difficult to obtain. It will also unlock an entirely new niche market for lenders and other service providers, offering them a valuable opportunity to expand their client bases into emerging markets overseas, and a new means to service those clients by decreasing capital requirements for their financing.”

James Morrison, president of the Small Business Exporters Association, said launch of the EDN represented “history for OPIC. This network will put wind into the sails of U.S. small businesses eager to expand into new markets. And as we know from experience, U.S. small businesses are the best engines of sustainable development anywhere.”

In June, Mosbacher announced that Wells Fargo HSBC Trade Bank would serve as an EDN designated lender through an agreement with OPIC to establish a $100 million lending facility. The facility is expected to generate up to 50 loans over the life of the facility, as well as more than 1000 host country jobs by its fifth year. Loans will range from $3 million to $15 million. The facility is expected to be the first of several that will enable EDN to grow significantly.

In addition, 14 organizations have agreed to serve as EDN loan originators: African Investment Corporation, LLC; Bank of Alameda; CEO Advisors; Delphos International, Ltd.; EPS Capital Corp.; Fidelity Indemnity (Pty) Limited; Florida Export Finance Corporation; Interlink Capital Strategies; GDI Financial Partners, LLC; MCDRS, LLC; METRIC, Inc.; Onfe, Inc.; Project Finance Advisors, LLC; and Terra Vista Capital, Inc.

An analysis commissioned by OPIC in 2004 concluded that a network such as EDN would be the most cost-effective way for OPIC to meet growing demand by American SMEs for the agency's support.

OPIC was established as an agency of the U.S. government in 1971. It helps U.S. businesses invest overseas, fosters economic development in new and emerging markets, complements the private sector in managing risks associated with foreign direct investment, and supports U.S. foreign policy. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers.

OPIC’s political risk insurance and financing help U.S. businesses of all sizes invest in more than 150 emerging markets and developing nations worldwide. Over the agency’s 35-year history, OPIC has supported $164 billion worth of investments that have helped developing countries to generate more than 732,000 host-country jobs and $13 billion in host-government revenues. OPIC projects have also generated $69 billion in U.S. exports and supported more than 264,000 American jobs.