"Ready for dinner"
Representative David Scott, D-GA., did some homework before a Congressional hearing on Thursday, held to explore whether or not to “reauthorize” the Overseas Private Investment Corporation, (OPIC) a U.S. agency that provides loans and “political risk insurance” to American companies looking to do business in foreign lands. When Scott’s turn came to ask questions of Robert Mosbacher, the president and CEO of OPIC, the Congressman wasted no time zooming in on the agency’s Iraq funding trajectory. (Transcript provided by the Congressional Quarterly).
SCOTT: Are you investing in Iraq? Does OPIC have any investments in Iraq?
MOSBACHER: Yes, OPIC has about $150 million of investment in Iraq. The largest piece of that is something we call the Iraq Middle Market Facility, which is a small business lending facility that has made about $46 million of loans and has about another $58 million in the pipeline.
And we’ve been involved in a variety of other stand-alone projects like bottling plants and things of that sort. But, yes, sir, we do support investment in Iraq.
SCOTT: And in these projects in Iraq, how many jobs were created?
MOSBACHER: Well, we do a calculation on every project in terms of the number of jobs created, and I’d have to get you that figure in terms of how many have been created by the variety of small business loans we’ve made.
But I’m a big believer that small business creates most of the jobs not just in our country, but elsewhere. And that’s why we feel like this is a very catalytic sort of area to be helpful.
SCOTT: So then it’s safe to say that there were investments in 2004 of about $200 million, 2005 about $100 million, 2006 less than $7 million. It has dramatically, dramatically dropped.
So as we assess where we are in our policies involving Iraq, what is the future of your investment in Iraq and what would you attribute this dramatic decrease to year-by-year, from $200 million to $7 million, and then what is the future for…
MOSBACHER: That’s not a function of any change of heart. It’s really a function of when we actually book business or have the commitments made or begin disbursements.
The Iraq Middle Market Facility that I described to you is one that we’ve added to, and as a consequence, it doesn’t appear as an additional investment, but in fact we are in the final stages right now of adding another $8 million to it. But it was booked in the year in which we originally committed to it.
So we continue to support the viable investments that we have. I will say some of those are more weighted toward Irbil in the northern part of the country than was previously the case, but there are still deals that are being done in and around Baghdad.
Mosbacher’s attempt to wave off the decrease in investment commitments notwithstanding, the “dramatic” numbers appear to speak for themselves. Iraq — not so great a place to do business. Or at least, not so great a place to do any new business, while you struggle desperately to keep the old stuff “viable.”