Abhinav ChandraIndresh SinghKanchan LataAnkita Gosain

OPIC & MIGA

OPIC Definition:- Overseas Private Investment

Corporation. This programme started in 1948 but was established in 1971.

The Overseas Private Investment Corporation (OPIC) is an agency of the United States Government that helps U.S. businesses invest overseas and promotes economic development in new and emerging markets.

Purpose / Aim

OPIC founded an idea that promoting private enterprise is key to helping developing nations build their economies.

To support U.S. private sector investment

To assist in economic growth of developing countries.

To improve American competitiveness.

Purpose / AimTo operate on a self-sustaining basis.

Opening of new Eastern Europe / Former Soviet Union markets.

Mobilize & facilitate participation of U.S. private capital/skills in economic development of less developed countries.

Need for OPIC ?Access new markets.International competition. Investment financing.Host country incentives.Helping developing/underdeveloped countries to develop their economy and providing markets for U.S.

Role Of OPICThe agency provides political risk

insurance.OPIC also provides financing through

direct loans and loan guaranties.OPIC was created to mobilize and

facilitate the participation of United States private capital and skills in the economic and social development of less developed countries and areas, and countries in transition from nonmarket to market economies.

OPIC Programmes

Project finance

Political Risk Insurance

Investment Funds

Political riskThe risk of loss when investing in a given

country caused by changes in a country's political structure or policies, such as tax laws, tariffs, expropriation of assets, or restriction in repatriation of profits.

For example : A company may suffer from

such loss in the case of expropriation or tightened foreign exchange repatriation rules, or from increased credit risk if the government changes policies to make it difficult for the company to pay creditors.

POLITICAL RISK INSURANCE

Political risk insurance is available to U.S. investors, contractors, exporters and financial institutions involved in international transactions.

Political risk insurance can cover currency inconvertibility, expropriation and political violence, and is available for investments in new ventures, expansions of existing enterprises, privatizations and acquisitions with positive developmental benefits.

The Need for Political Risk Insurance

To cover possible damage or loss ,Tangible assets such as trucks, manufacturing or drilling equipment ,Value of investment ,Earnings or return of the investment .

To obtain or attract financing in the face of risk .

To deter long-term losses through OPIC’s advocacy.

Geographic distribution

Latin America

Asia & Pacific

Sub-SaharanAfrica

Europe (incl. Turkey)

New Independent States

North Africa/Middle East

29%

17%

6%7%

14%

27%

Investment of OPIC In IndiaPreferred Brand International

Deals with Purchase Equipments, implement marketing and distribution. (lead by:- Ashok & Meera Vasudevan.)

Sanghvi Movers Deals with Hydraulic & Crawler Cranes. (Its a financial Intermediary).

Investor Eligibility.U.S. citizen U.S. corporations, partnerships or

other business organizations that are over 50% U.S. owned

Foreign corporations, partnerships or

other business organizations that are over 95% U.S. owned.

Project Eligibility Project types

New projects Expansions Acquisitions Privatizations

Project Eligibility Project Requirements

Positive development effects on host country

No negative U.S. economic effects

Any amount of U.S. ownership Limited foreign government participation

Environmentally sound

Investment EligibilityGenerally 3 year term or longer. Will assist exporting that is related to long term investment commitment

Contributions of value, including :- Equity Debt (inter-company debt or bank financing)

Leasing (capital, financial, leasing companies)

Services Technical assistance

Country EligibilityOPIC bilateral agreement required

Foreign Government Approval (“FGA”) may be necessary.

Must follow country exposure limits.

MIGADefinition:-Multilateral Investment

Guarantee Agency .MIGA was founded in 1988 with a

capital base of $1 billion and is headquartered in Washington, D.C.

MIGA is directly involved with financing economic assistance to IRAN

Purpose / AimMIGA promotes FDI into developing

countries by insuring investors against political risk, advising governments on attracting investment, sharing information through on-line investment information services, and mediating disputes between investors and governments.

Purpose / AimMIGA provides guarantees against

non-commercial risks to protect cross-border investment in developing member countries.

Guarantees protect investors against the risks of Transfer Restriction, Expropriation, War and Civil Disturbance, and Breach of Contract (for contracts between the investor/project enterprise and the authorities of the host country).

THANKS