New Agreement Between OPIC and Indonesia Infrastructure Guarantee Fund Sets Goal of Increased Investment
Tuesday, November 13, 2012
Under Secretary of Commerce Sanchez witnesses MOU signing in Jakarta
JAKARTA, Indonesia - Aiming to increase U.S. investment in Indonesia’s infrastructure, a sector critical to that country’s future economic growth, the Overseas Private Investment Corporation (OPIC), the U.S. Government’s development finance institution, today concluded a memorandum of understanding (MOU) with the Indonesia Infrastructure Guarantee Fund (IIGF). The IIGF is the state-owned enterprise created by Indonesia to serve as a single window for appraising, structuring and providing guarantees for Public-Private Partnership (PPP) infrastructure projects.
OPIC Vice President of Insurance John Moran, right, and Sinthya Roesly, CEO of the Indonesia Infrastructure Guarantee Fund (IIGF), sign a memorandum of understanding between OPIC and IIGF which aims to increase investment in Indonesia’s infrastructure, with Under Secretary of Commerce Francisco Sanchez as a witness
The signing was witnessed by Under Secretary of Commerce Francisco Sanchez, who is leading a U.S. delegation to the region. Under Secretary Sanchez is also a member of OPIC’s Board of Directors.
The MOU pledges OPIC and IIGF’s cooperation in promoting private sector infrastructure investment in Indonesia through mutual efforts to identify prospects for joint project support, as well as training and application screening, in order to raise OPIC’s portfolio in Indonesia to a level ‘consistent with the size of its economy.’
“Indonesia is the largest economy in southeast Asia, an investment-grade destination for American capital, and an important trade partner for the United States. Increased U.S. investment to expand Indonesia’s infrastructure is now expected to result from OPIC’s closer cooperation with IIGF, which will accelerate Indonesia’s already-rapid economic growth. This, in turn, will support American companies and the partnership between our two countries,” said OPIC Vice President of Insurance John Moran, who signed the MOU.
Sinthya Roesly, IIGF’s CEO, noted that the MOU will “provide the basis for further contributions of IIGF and OPIC to the development of Indonesian infrastructure. Through this MOU, OPIC and IIGF will enhance understanding of each other’s underwriting process and develop a workable model for joint support for infrastructure projects.”
The MOU caps a two-year period of intensive OPIC focus on Indonesia, highlighted by:
Over its 41-year history, OPIC has provided nearly $2.6 billion in financing and political risk insurance for 112 projects in Indonesia, and maintains a current portfolio of $56 million in the country.
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 more than $200 billion of investment in over 4,000 projects, generated an estimated $75 billion in U.S. exports and supported more than 276,000 American jobs.