OPIC supports American businesses in emerging markets by providing medium-to long-term debt financing through loans and guaranties to eligible investments in developing countries and emerging markets. By complementing the private sector, OPIC can provide financing in countries where conventional financial institutions often are reluctant or unable to lend.
OPIC can meet the long-term capital investment financing needs of any size business in a wide variety of industries such as information technology, health care, education, infrastructure, telecommunications, financial services, housing, and agribusiness. The majority of OPIC’s financing is used to cover the capital costs—such as design/engineering services, facility construction or leasehold improvements, and equipment—associated with the establishment or expansion of the foreign investment (the “project”).
OPIC can also work with financial institutions to fund the expansion of lending capacity -- such as small business lending or mortgage lending -- in a foreign market. On-lending platforms including banks, microfinance institutions (MFIs), non-bank financial institutions (NBFIs), and investment funds making loans are welcome to apply.
OPIC does not consider financing requests that are solely for the purpose of making an acquisition, though limited acquisition costs may be financeable if additional capital will be expended to expand or rehabilitate the investment.
OPIC seeks to support early stage projects that demonstrate significant potential to achieve a positive social or environmental impact. These projects face obstacles to adequate financing in emerging markets because of their relative size and early stage of development. If you represent an innovative, earlier stage company with that is committed to a high level of social impact, please read more about OPIC support for your company through OPIC’s Portfolio for Impact Program (PI).
OPIC does not finance stand-alone export transactions. To learn more about other U.S. government programs that support exports, please visit www.export.gov.
OPIC financing at work: Tripling energy generating capacity in Togo
Togo, a small country in West Africa, has one of the lowest rates of per capita energy generation in the world. In 2006, the country’s demand for electricity was nearly twice as high as production and the shortage of domestic energy was exacerbated by growing demand for electricity in the rest of West Africa, which reduced the ability of some neighboring countries to export to Togo. In addition, the country’s traditional reliance on imports of hydropower from Cote D’Ivoire and Ghana left its energy supply vulnerable to drought. The country was forced to ration power with daily rolling blackouts. Frequent power outages in 2006 resulted in an estimated $150 million to $190 million in private sector losses, about half of the annual revenue of the government of Togo.
OPIC provided $209 million in loans and political risk insurance to New York-based ContourGlobal to build a 100 MW “tri-fuel” power plant.
The project, the largest energy investment ever made in the Republic of Togo, increased Togo’s electricity capacity, reducing blackouts and diversifying fuel sources. In 2013, the project was also recognized as one of the public-private partnerships of recent years by the International Finance Corporation and Infrastructure Journal.
OPIC financing at work: Supporting a small Oklahoma oil producer in Colombia
It’s said that if you build it they will come, but when trying to introduce a promising technology into an emerging market, it’s not always that easy. Joshi Technologies of Tulsa, Oklahoma, learned this when it sought to apply an advanced oil production technology he developed to an aging oil field in Colombia.
“As a small business seeking to do business in Colombia, I knew that no bank in the U.S. would give us a loan,” said Joshi President Sadanand Joshi. His company had successfully produced oil in several small fields in the U.S. as well as Canada and India, but after it invested in the Palagua field in a remote region of northern Colombia, it could not obtain the financing needed to move forward with production.
In 2004, OPIC provided a $3.8 million loan to Joshi which it used to support production at Palagua. At the time, the Palagua field had already produced 110 million barrels of crude oil under the management of a major multinational oil company, and was considered to be near the end of its producing life. However by applying “slanted drilling” technology, a variation of the innovative horizontal drilling technique that Joshi helped develop, Joshi and its local partners were able to increase yields. Since committing the initial loan, OPIC has provided three additional loans to Joshi and the field has produced more than 4,000 barrels per day for the past decade – surpassing its total yield at the time Joshi first became an investor.
“Without OPIC it would not have been possible. We would have had to sell the project,” says Joshi.