Legislation to Promote U.S. Business Investment in Developing Countries and Save Taxpayers $20 Million
WASHINGTON – U.S. Senators Bob Corker (R-Tenn.) and Chris Coons (D-Del.), both members of the Senate Foreign Relations Committee, today praised Senate passage of The Better Utilization of Investments Leading to Development Act of 2018 (BUILD Act) as part of legislation to reauthorize the Federal Aviation Administration (FAA). With strong support in Congress, from the administration, and among key stakeholders, the BUILD Act, coauthored by Corker and Coons in the Senate, will promote economic growth in developing countries through U.S. business investment while saving taxpayers $20 million. The FAA bill will now go to the president’s desk to be signed into law.
“The BUILD Act will begin to move us away from providing direct assistance with mixed results and instead help countries become more self-reliant while saving taxpayers millions of dollars,” said Corker. “This legislation will use the free-market to stimulate long-term economic growth in the developing world that will create new markets for American businesses and advance U.S. interests for stability abroad. Thanks to strong support from the administration, in both houses of Congress, and among businesses and nongovernmental organizations, this transformative effort is now on its way to becoming law.”
“Passage of the BUILD Act shows what we can accomplish when we set politics aside and work together,” said Coons. “The BUILD Act creates a 21st century development finance institution that will double the U.S. lending capacity, bringing U.S. private sector investment to low income countries around the world. This investment will allow us to reduce poverty in areas that are critical to our national security, compete with Chinese influence in the developing world, and help U.S. businesses grow and succeed. I am thrilled this bill is headed to the President’s desk and I am grateful for the hard work and support of Senator Corker, the administration, and our partners on both sides of the aisle who worked tirelessly to get the BUILD Act across the finish line.”
The BUILD Act will create the U.S. International Development Finance Corporation (IDFC), assuming the activities of the Overseas Private Investment Corporation (OPIC), USAID’s Development Credit Authority, USAID’s Enterprise Funds, and other programs.
The IDFC will have the authority to: issue direct loans, including local currency loans; issue guaranties, including local currency guaranties; provide political risk insurance; fund first losses; participate in equity investments; provide technical assistance; make limited grants to unlock larger investments; and attract private sector talent.
The IDFC will prioritize support for projects in low and lower middle-income countries where it furthers U.S. national security and economic interests and where the project can be shown to have a demonstrable development outcome.
Congress will maintain oversight of the IDFC by reviewing the agency’s public reports on its development impact and through independent audits and the establishment of an inspector general in the corporation.
The Congressional Budget Office (CBO) estimates the act will decrease direct federal spending by $20 million over ten years.