A two-member US delegation of 'Overseas Private Investment Corporation' (OPIC) visited Pakistan to interact with the Pakistani businessmen for sponsoring viable projects and started meetings with Pakistani businessmen in different cities in this regard.
Basically, the OPIC facilitates the business community by providing direct loans for medium and long-term for private investment. Loans range from $100,000 million to $250 million has been provided for projects sponsored by US companies. In most cases, the US sponsor is expected to contribute at least 25 percent of the project equity due to its track record in the industry and having potential to contribute to the financial success of the projects.
The OPIC is working in Pakistan since 2002 and facilitates loans to the almost 15 projects in different sectors particularly in banking, telecom, power and SMEs. The delegation also wants to explore potential in thermal, hydel and wind energy generation. The diplomat said that despite poor law and order situation, Pakistan is still considered a safe destination for investment with viable economic opportunities.
Primarily, the OPIC focused on supporting developing countries that provided opportunities to the US businessmen to invest abroad, foster economic development in new and emerging markets, complementing the private sector in managing risks associated with foreign direct investment along with supporting the US foreign policy. The OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers.
The OPIC-supported projects not only help to create jobs for Americans but also generate exports. At the same time, OPIC promotes best practices requiring from the project authority to adhere to international standards on the environment, worker rights, and human rights.
The OPIC insures the US investors, contractors, exporters, and financial institutions against political violence, such as terrorism and war, nationalisation or expropriation by a foreign government; or the inability to convert local currency and repatriate profits. The OPIC can insure up to $250 million per project and has no minimum investment size requirement. Insurance is available for investments in new ventures, expansions of existing enterprises, privatisation's, and acquisitions with positive developmental benefits.
To address the lack of sufficient equity investment in emerging markets, OPIC has supported the creation of regional or sectoral funds that make direct investments in new expanding or privatising companies. These investment funds are privately-owned and managed providing long-term growth capital and serve as a catalyst for private sector economic activity and encourage the creation of new markets and opportunities for American companies.
The OPIC recognises that small businesses looking to invest overseas have unique requirements. To help meet these needs, OPIC can provide eligible businesses special financing and political risk insurance products which feature enhanced customer service, flexible coverage and easier access to OPIC services through a streamlined approval process.