View source for International Development Finance Corporation

{{short description|US federal agency responsible for providing foreign aid}}
{{Infobox government agency
| agency_name     = U.S. International Development Finance Corporation
| seal            = 
| logo            = DFC Logo.png
| logo_caption    = 
| logo_width      = 200px
| formed          = December 20, 2019
| preceding1      = [[Overseas Private Investment Corporation]] (OPIC) and [[Development Credit Authority]] (DCA) of the [[United States Agency for International Development]] (USAID)
| jurisdiction    = 
| headquarters    = [[Washington, D.C.]]
| employees       = 
| budget          = 
| chief1_name     = Scott A. Nathan
| chief1_position = Chief Executive Officer
| chief2_name     = [[Nisha Desai Biswal]]
| chief2_position = Deputy Chief Executive Officer
| chief3_name     = 
| chief3_position = 
| chief4_name     = 
| chief4_position = 
| chief5_name     = 
| chief5_position = 
| chief6_name     = 
| chief6_position = 
| chief7_name     = 
| chief7_position = 
| chief8_name     = 
| chief8_position = 
| chief9_name     = 
| chief9_position = 
| parent_department = 
| child1_agency   = 
| motto           = Investing in Development
| website         = {{URL |https://www.dfc.gov}}
| footnotes       = 
}}

The '''United States International Development Finance Corporation''' ('''DFC''') is a [[development finance institution]] and agency of the [[Federal government of the United States|United States federal government]]. DFC invests in [[Economic development|development]] projects primarily in lower and middle-income countries.<ref>{{Cite report |url=https://crsreports.congress.gov/product/pdf/R/R47006 |title=U.S. International Development Finance Corporation: Overview and Issues |last1=Akhtar |first1=Shayerah I. |last2=Brown |first2=Nick M. |date=10 January 2022 |publisher=Congressional Research Service |page=13}}</ref> First authorized on 5 October 2018 by the BUILD Act, the [[Independent agencies of the United States government|independent agency]] was formed on 20 December 2019 by merging the [[Overseas Private Investment Corporation]] (OPIC) with the [[Development Credit Authority]] (DCA) of the [[United States Agency for International Development]] (USAID), as well as with several other smaller offices and funds.<ref>{{cite web|url=https://trumpwhitehouse.archives.gov/briefings-statements/president-donald-j-trump-signs-h-r-302-law/|work=[[whitehouse.gov]]|title=President Donald J. Trump Signs H.R. 302 into Law|via=[[NARA|National Archives]]|access-date=15 October 2018}}</ref><ref>{{cite news|url=https://www.nytimes.com/2018/10/14/world/asia/donald-trump-foreign-aid-bill.html?emc=edit_nn_20181015&nl=morning-briefing&nlid=1418504420181015&te=1|title=Trump Embraces Foreign Aid to Counter China's Global Influence|last1=Thrush|first1=Glenn|newspaper=The New York Times|access-date=15 October 2018|date=2018-10-14}}</ref>

DFC's lending capacity is used to provide loans, loan guarantees, direct equity investments, and political risk insurance for private-sector led development projects, feasibility studies, and technical assistance.<ref name = CRSFactsheet>{{Cite report |url=https://crsreports.congress.gov/product/pdf/IF/IF11436 |title=U.S. International Development Finance Corporation |date=February 2022 |publisher=Congressional Research Service}}</ref> DFC invests across several sectors including energy, healthcare, critical infrastructure, and technology,<ref name = A&B19>Akhtar and Brown 2022, p. 19.</ref> with stated priorities of women's empowerment, innovation, investment in West Africa and the Western Hemisphere, and climate change.<ref>Akhtar and Brown 2022, pg. ''i.''</ref>

== History ==
U.S. development finance efforts were consolidated under the [[Overseas Private Investment Corporation]] (OPIC) in 1969 by President Richard Nixon, transferring responsibility from the [[United States Agency for International Development]] (USAID). The goal was to promote a more business-like management of development finance policy. In the 2010s, the Obama administration came to support a further consolidation of U.S. development finance in light of the increasing Chinese investment in the developing world (particularly through the [[Belt and Road Initiative]]).<ref>Akhtar and Brown 2022, pp. 1–4.</ref>

The Trump administration originally opposed OPIC, and its proposed 2018 budget had called for the elimination of OPIC altogether,<ref name="Kuo2018">{{cite web |last1=Kuo |first1=Mercy A. |title=The US International Development Finance Corporation and China:Insights from Riva Levinson. |url=https://thediplomat.com/2018/10/the-us-international-development-finance-corporation-and-china/ |publisher=The Diplomat |access-date=21 March 2022 |date=25 October 2018}}</ref><ref name="Reuters2018">{{cite news |last1=Zengerle |first1=Patricia |title=Congress, eying China, votes to overhaul development finance |url=https://www.reuters.com/article/us-usa-congress-development/congress-eying-china-votes-to-overhaul-development-finance-idUSKCN1MD2HJ |access-date=21 March 2022 |work=Reuters |date=3 October 2018 |language=en}}</ref> but advocacy by some administration officials, senators, and others convinced the White House to support the consolidation of OPIC and development finance efforts in line with the President's policy priorities.<ref name="Kuo2018"/><ref name="Akhtar and Brown 2022, pp. 3–4">Akhtar and Brown 2022, pp. 3–4.</ref> Relevant legislation — the Better Utilization of Investments Leading to Development (BUILD) Act — was introduced in Congress to establish the DFC shortly thereafter.<ref name="Akhtar and Brown 2022, pp. 3–4"/><ref name="DevEx2018">{{cite web |last1=Saldinger |first1=Adva |title=How policy wonks, politicos, and a conservative Republican remade US aid |url=https://www.devex.com/news/how-policy-wonks-politicos-and-a-conservative-republican-remade-us-aid-93934 |website=Devex |access-date=22 March 2022 |date=5 December 2018}}</ref>

=== The BUILD Act ===
The BUILD Act was introduced in the House and Senate in February 2018 with broad bipartisan support,<ref name="CSISOct18">{{cite web |last1=Runde |first1=Daniel F. |last2=Bandura |first2=Romina |title=The BUILD Act Has Passed: What's Next? |url=https://www.csis.org/analysis/build-act-has-passed-whats-next |publisher=Center for Strategic and International Studies |access-date=22 March 2022 |language=en |date=12 October 2018}}</ref> based on proposals drafted by researchers at the [[Center for Global Development]].<ref name = DevEx2018/> It passed the Senate as a part of a bill to reauthorize the Federal Aviation Administration on a vote of 93–6 in early October 2018; it had already been passed in the House.<ref name="Reuters2018"/> It was signed into law by President Trump on October 5.<ref>{{Cite report |url=https://sgp.fas.org/crs/misc/R45461.pdf |title=BUILD Act: Frequently Asked Questions About the New U.S. International Development Finance Corporation |last1=Akhtar |first1=Shayerah I. |last2=Lawson |first2=Marian L. |date=15 January 2019 |publisher=Congressional Research Service |page=5}}</ref>

Concern over Chinese investment abroad and the inability for existing U.S. developmental finance institutions to keep up was a major factor pushing the passage of the Act, and the establishment of the DFC has widely been viewed as means to counter China, particularly its Belt and Road Initiative.<ref name="Reuters2018"/><ref name="CSISOct18"/><ref>{{cite web|last=Kliman|first=Daniel|title=Leverage the new US International Development Finance Corporation to compete with China|url=https://thehill.com/opinion/international/416904-leverage-us-international-development-finance-corporation-compete-with-china|website=The Hill|date=16 November 2018|access-date=12 August 2019}}</ref><ref>Akhtar and Lawson 2019, p. 4.</ref><ref name="SCMP2020">{{cite news |last1=Lo |first1=Kinling |title=US International Development Finance Corporation targets Asia as Washington seeks to offer alternative to Chinese cash|url=https://www.scmp.com/news/china/diplomacy/article/3045686/us-international-development-finance-corporation-targets-asia |access-date=22 March 2022 |work=South China Morning Post |date=12 January 2020 |language=en}}</ref>

The Act aimed to ameliorate deficiencies in existing U.S. development finance policy, particularly restrictions on OPIC's actions. Compared to OPIC, the BUILD Act eases requirements of U.S. citizenship for parties to a given investment pursued by the DFC; allows the DFC to hold equity (rather than only make loans); allows the DFC to take on a greater risk burden than OPIC could for a given project; and allows the DFC to make loans in local currencies.<ref>{{Cite report |url=https://www.jstor.org/stable/resrep26417 |title=How Can the U.S. International Development Finance Corporation Effectively Source Deals? |last1=Runde |first1=Daniel F. |last2=Bandura |first2=Romina |date=2020 |publisher=Center for Strategic and International Studies |last3=Staguhn |first3=Janina |page=3}}</ref> DFC's total spending cap for its investments was also raised to $60 billion, compared to $29 billion for OPIC.<ref name="CSISOct18"/>

== Investments and priorities ==
DFC invests in sectors that include sanitation, infrastructure, healthcare, and food security. The DFC lists innovation, sustainable jobs, workers' protection, women's economic empowerment, and bolstering global supply chains as broader themes in its investment priorities.<ref>Akhtar and Brown 2022, pp. 19–20.</ref> The DFC states that its investments aim to advance global development, U.S. foreign policy, and U.S. taxpayer interests.<ref name="Akhtar and Brown 2022, pp. 3–4"/>

Specific initiatives of the DFC include the 2X Women's Initiative, inherited from OPIC, that focuses on women-owned businesses and/or products and services designed to empower women.<ref>Akhtar and Brown 2022, p. 20.</ref> DFC has collaborated with USAID and other U.S. agencies in the Power Africa program, which has facilitated power sector deals across the continent,<ref name="Runde pp. 3">Runde, Bandura and Staguhn, pp. 3–4.</ref> and the Prosper Africa Initiative, launched in 2018 with the goal of promoting U.S.-Africa investment and trade, countering Chinese influence.<ref name="Runde pp. 3"/><ref>{{Cite report |url=https://sgp.fas.org/crs/row/IF11384.pdf |title=The Trump Administration's Prosper Africa Initiative |last1=Cook |first1=Nicolas |last2=Williams |first2=Brock R. |date=17 November 2020 |publisher=Congressional Research Service |page=1}}</ref>

=== Response to COVID-19 ===
On May 14, 2020, President Trump signed an Executive Order which delegates authority to the DFC Chief Executive Officer to make loans to private institutions to support the response to COVID-19 or strengthen relevant supply chains.<ref>[https://trumpwhitehouse.archives.gov/presidential-actions/eo-delegating-authority-dpa-ceo-u-s-international-development-finance-corporation-respond-covid-19-outbreak/ www.whitehouse.gov]</ref> Trump administration, through DFC, announced that it planned to give [[Kodak]] a $765&nbsp;million loan for manufacturing ingredients used in pharmaceuticals, in order to rebuild the national stockpile depleted by the [[COVID-19 pandemic]] and reduce dependency on foreign factories.<ref>{{Cite news|last=Rampton|first=Roberta|date=2020-07-28|title=Trump Gives Medical Stockpile A 'Kodak Moment' With New Loan To Make Drugs|url=https://www.npr.org/sections/coronavirus-live-updates/2020/07/28/896209016/trump-gives-medical-stockpile-a-kodak-moment-with-new-loan-to-make-drugs|access-date=2020-10-28|newspaper=[[NPR]]|language=en}}</ref> The funding was put on hold as the [[U.S. Securities and Exchange Commission]] began probing allegations of [[insider trading]] by Kodak executives ahead of the deal's announcement,<ref>{{cite news |last1=Michaels |first1=Dave| last2=Francis |first2=Theo |title=Kodak Loan Disclosure and Stock Surge Under SEC Investigation |url=https://www.wsj.com/articles/kodak-loan-disclosure-and-stock-surge-under-sec-investigation-11596559126 |access-date=28 October 2020 |work=Wall Street Journal |date=4 August 2020}}</ref> and DFC's inspector general announced scrutiny into the loan terms.<ref>{{cite news |last1=Levy |first1=Rachael |title=Kodak Deal Draws Review From Watchdog at Agency Involved in Planned Loan |url=https://www.wsj.com/articles/kodak-loan-draws-review-from-watchdog-at-agency-involved-in-deal-11600096107 |access-date=28 October 2020 |work=Wall Street Journal |date=14 September 2020}}</ref> The agency received criticism for the loan deal.<ref>{{cite news |last1=Rappeport |first1=Alan |last2=Swanson |first2=Ana |last3=Thrush |first3=Glenn |title=Kodak Loan Debacle Puts a New Agency in the Hot Seat |url=https://www.nytimes.com/2020/10/25/business/economy/kodak-loan.html |access-date=28 October 2020 |work=The New York Times |date=25 October 2020}}</ref> 
The agency has given millions of dollars to [[ApiJect Systems]].<ref>{{Cite news|title=U.S. Bets On Small, Untested Company to Deliver COVID Vaccine|url=https://www.pbs.org/wgbh/frontline/article/apiject-u-s-bets-on-small-untested-company-deliver-covid-vaccine/|access-date=2021-04-21|website=FRONTLINE|language=en-US}}</ref>

== Leadership ==
[[File:Scott A. Nathan, DFC CEO.jpg|thumb|upright|Scott Nathan, CEO since February 2022]]
Current CEO Scott Nathan was nominated by the Biden-Harris Administration in September 2021 and was confirmed February 9, 2022.<ref>{{cite news |last1=Lizza |first1=Ryan |title=POLITICO Playbook: War in Europe |url=https://www.politico.com/newsletters/playbook/2022/02/24/war-in-europe-00011319 |access-date=13 March 2022 |work=Politico |date=24 February 2022}}</ref><ref>{{cite web |url=https://www.dfc.gov/who-we-are/office-chief-executive/scott-nathan |title=Scott Nathan |work=dfc.gov |date= |access-date=August 13, 2024 |archive-url=https://archive.today/20240813190134/https://www.dfc.gov/who-we-are/office-chief-executive/scott-nathan |archive-date=August 13, 2024}}</ref>

{|class="wikitable"
|-
!No.
! CEO
! Tenure
|-
|1
|[[Adam S. Boehler]]
|October 1, 2019 – January 20, 2021
|-
|–
|Dev Jagadesan<br/>(Acting)
|January 20, 2021 – 9 February 2022
|-
|2
|Scott A. Nathan
|9 February 2022 – ''present''
|}

The position of deputy CEO was first filled in 2023 by [[Nisha Desai Biswal]].<ref>{{cite web|url=https://www.congress.gov/nomination/118th-congress/483|title=PN483 — Nisha Desai Biswal — United States International Development Finance Corporation|work=United States Congress|date=July 27, 2023}}</ref>
{|class="wikitable"
|-
!No.
! Deputy CEO
! Tenure
|-
|1
|[[Nisha Desai Biswal]]
|August 14, 2023 – ''present''
|}

===Board of Directors===
The board of directors is composed of nine members, four appointed by the [[president of the United States]] with the consent of the [[United States Senate]] and five ''[[ex officio]]'' members. The five ''ex officio'' members are the CEO of the DFC, the [[U.S. Secretary of State]], the [[Administrator of the United States Agency for International Development]], the [[U.S. Secretary of the Treasury]], and the [[U.S. Secretary of Commerce]]. Apart from the CEO, these may be represented on the board by their designees. A designee must be from among officers who are appointed by the President, by and with the advice and consent of the Senate; whose duties relate to the programs of the Corporation; and who is designated by and serving at the pleasure of the President.<ref name="USC">{{USCode|22|9613}}</ref>

Of the four appointed members, one each shall be appointed from lists of at least five individuals submitted by the minority leader and Speaker, and minority and majority leader of the House of Representatives and Senate, respectively. In making their lists, they shall consult with their parties' leader on the [[United States House Committee on Foreign Affairs|Committee on Foreign Affairs]] and [[United States Senate Committee on Foreign Relations|Committee on Foreign Relations]], respectively. These members may not be an officer or employee of the U.S. government, and shall have relevant experience, which may include experience relating to the private sector, the environment, labor organizations, or international development.<ref name="USC" />

These four serve terms of three years, and may be reappointed to one additional term. They may continue to serve after the expiration of each of their terms of office until a successor has been confirmed.<ref name="USC" />

The Secretary of State, or their designee, serves as the chairperson of the board. The Administrator of USAID, or their designee, serves as the vice chairperson. A majority of the members of the board constitutes a quorum.<ref name="USC" />

===Current board members===
The current board members as of September 26, 2024:<ref>{{cite web |url=https://www.dfc.gov/who-we-are/our-people/board-directors |title=Board of Directors |author=<!--Not stated--> |date=<!--Not stated--> |website=DFC.gov |publisher=U.S. International Development Finance Corporation |access-date=September 26, 2024}}</ref>
{| class="wikitable sortable" style="text-align:center"
! Position
! Name
! Party 
! Assumed office
! Term expiration
|-
! Chair ''(ex officio)''<br>Secretary of State
| {{sortname|Antony|Blinken}}
| {{party shading/Democratic}} | Democratic
| {{dts|2021|01|26}}
| —
|-
! Vice chair ''(ex officio)''<br>Administrator of USAID
| {{sortname|Samantha|Power}}
| {{party shading/Democratic}} | Democratic
| {{dts|2021|05|03}}
| —
|-
! Member ''(ex officio)''<br>CEO of the DFC
| {{sortname|Scott A.|Nathan}}
| {{party shading/Democratic}} | Democratic
| {{dts|2022|02|09}}
| —
|-
! Member ''(ex officio)''<br>Secretary of the Treasury
| {{sortname|Janet|Yellen}}
| {{party shading/Democratic}} | Democratic
| {{dts|2021|01|26}}
| —
|-
! Member ''(ex officio)''<br>Secretary of Commerce
| {{sortname|Gina|Raimondo}}
| {{party shading/Democratic}} | Democratic
| {{dts|2021|03|03}}
| —
|-
! Member
| {{sortname|Christopher P.|Vincze}}
| {{party shading/Republican}} | Republican
| {{dts|2019|06|13}}
| {{dts|2019|12|17}}
|-
! Member
| {{sortname|Deven J.|Parekh}}
| {{party shading/Democratic}} | Democratic
| {{dts|2020|12|16}}
| {{dts|2023|12|16}}
|-
! Member
| {{sortname|Irving W.|Bailey II}}
| {{party shading/Republican}} | Republican
| {{dts|2020|12|16}}
| {{dts|2023|12|16}}
|-
! Member
| ''Vacant''
| 
| 
| 
|}

===Nominations===
President [[Joe Biden|Biden]] has nominated the following to fill seats on the board. They await Senate confirmation.<ref>{{cite web |url=https://www.congress.gov/quick-search/nominations?wordsPhrases=International+Development+Finance+Corporation&wordVariants=on&congressGroups%5B0%5D=0&congresses%5B0%5D=118&nomCivil=on&nomOther=on&pnNumbers=&nomineeNames=&positions=&organizations=&stateTerritories%5B0%5D=any&nominationAction=&dates=datesReceivedInSenate&dateOperator=equal&startDate=&endDate=&dateIsOption=yesterday |title=Quick Search International Development Finance Corporation |author=<!--Not stated--> |date=<!--Not stated--> |website=Congress.gov |publisher=Library of Congress |access-date=September 26, 2024}}</ref>
{| class="wikitable sortable" 
|-
! Name !! Party !! Replacing
|-
| {{sortname|Deven J.|Parekh}} || {{party shading/Democratic}} | Democratic || Reappointment
|-
| {{sortname|Irving W.|Bailey II}} || {{party shading/Republican}} | Republican || Reappointment
|}

== Reception ==

Commentators have criticised the DFC's investments in upper-middle-income countries that are apparently intended to achieve U.S. foreign policy objectives other than international development, describing these investments as [[mission creep]].<ref>{{cite web|url=https://www.cgdev.org/blog/dfc-going-be-development-finance-institution-or-foreign-policy-bank|title=Is DFC Going To Be a Development Finance Institution or a Foreign Policy Bank?|date=25 March 2021|first1=Clemence|last1=Landers|first2=Scott|last2=Morris|first3=Charles|last3=Kenny|first4=Nancy|last4=Lee|first5=Jocilyn|last5=Estes|publisher=[[Center for Global Development]]|access-date=17 January 2022}}</ref><ref>{{cite web|url=https://www.csis.org/analysis/mission-creep-development-finance-corporation|title=Mission Creep at the Development Finance Corporation|date=20 September 2021|first=Conor M.|last=Savoy|publisher=[[Center for Strategic and International Studies]]|access-date=17 January 2022}}</ref> Scott Morris of the [[Center for Global Development]] has criticised federal budget rules that require the DFC to treat equity investments as expenditures "with no offsetting allowance for [their] expected financial returns," unlike loans, which are budgeted based on their [[Subsidized loan|subsidy costs]].<ref>{{cite web|url=https://www.cgdev.org/blog/current-budget-rules-stand-way-reasonable-path-us-dfc-realize-ambition-climate-and-pandemic|title=Current Budget Rules Stand in the Way of a Reasonable Path for US DFC to Realize Ambition on Climate and Pandemic Response|date=19 April 2021|first=Scott|last=Morris|publisher=[[Center for Global Development]]|access-date=17 January 2022}}</ref>

== See also ==
* [[Export–Import Bank of the United States]]

== References ==
{{Reflist}}

==External links==
{{Library resources box}}
* [http://www.dfc.gov Official website]

{{Authority control}}

[[Category:2019 establishments in the United States]]
[[Category:Government agencies established in 2019]]
[[Category:Government agencies in the United States]]
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[[Category:National development banks]]