OPIC Committed $2.7 billion to High-Impact Sectors in 2013
May 30, 2014
WASHINGTON – The Overseas Private Investment Corporation is proud to release for the first time a detailed picture of its Fiscal Year 2013 commitments in the impact investing space. OPIC has long been a leader in defining impact investing, which leverages private capital to invest for positive social and environmental change.
“OPIC’s extensive impact portfolio defines our mission to support the very best of projects that seek both social and environmental returns,” said Elizabeth Littlefield, OPIC’s President and CEO. “We have a long history of transforming private capital into solutions for common social and environmental challenges around the world, and today OPIC is the largest impact investor in the U.S. Government.”
In seeking to develop a more specific definition for what constitutes an impact investment, OPIC has applied three measures to its own 2013 portfolio:
Development Finance: $3.9 billion - All of OPIC's annual financial commitments – in 2013 totaling $3.9 billion – aim to have a positive development impact, by achieving development, social, and financial returns while safeguarding against damage to the environment.
High-Impact Sectors: $2.7 billion- Last year, more than two-thirds of OPIC’s total commitments – $2.7 billion – were in high-impact sectors that are recognized for fostering positive social, environmental and economic development. These sectors include agriculture, education, access to finance, housing for the poor, small and medium enterprise finance, healthcare, renewable energy, water and sanitation.
These OPIC commitments included more than $950 million in SME financing vehicles and more than $1.2 billion for renewable energy projects. These projects span multiple regions, including Guatemalan SME lenders that will be the backbone of development impact for thousands of small entrepreneurs and a medical center in Malaysia that will serve people of all income levels with quality healthcare while creating thousands of local jobs.
Impact Investing: $222 million - A further subset of OPIC’s 2013 commitments – $222 million – were categorized as full impact investing. These investments had an explicit and inherent intent at startup to address environmental or social issues, as well as a business model with a structure dedicated to achieving both impact and financial returns.
Among this distinct segment of OPIC’s portfolio is support for a network of schools throughout rural Kenya that provides a world-class curriculum for $60 per year per student, and a $45 million loan to FINCA, a microfinance lending institution that operates in developing markets across three continents through community-based credit and savings opportunities. These projects display clear objectives of social or environmental return and display impact intent.
“OPIC is fortunate to invest in and work alongside so many great partners who share our aims,” added Littlefield. “At a time when private capital is one of the best tools for addressing major developmental challenges, OPIC has helped grow the impact investing sector by channeling this capital to invest in sustainable economic development across the planet.”
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 $76 billion in U.S. exports and supported more than 278,000 American jobs.