» Home » Business News Iraq Directory Services Plans Subscription Contact us Site Map Help About Iraq OPIC board approves $150 million to support Trade bank of Iraq The board of directors of the Overseas Private Investment Corporation (OPIC) has approved $150 million in financing for a U.S. trust facility established to support efforts by the new Trade Bank of Iraq (TBI) to rebuild the Iraqi economy. OPIC’s financing, which includes an initial $70 million financing transaction coordinated by Citigroup, will guaranty financing by TBI to foreign exporters involved in reconstruction projects. By supporting the bank’s reimbursement obligations, the trust will facilitate the provision of goods and services vital to Iraq’s reconstruction after decades of international isolation. Specifically, the trust will only guaranty reimbursement obligations on TBI letters of credit, which are not, or not entirely, supported by export credit agency cover. Consequently, the project is designed to increase the availability of financing for Iraqi trade transactions and to enable Iraqi funds to be leveraged in a more efficient manner. The trust represents the first time that commercial lenders like Citigroup are able to extend letters of credit that are not fully collateralized. “Provision of trade finance for companies seeking to contribute to Iraq’s reintegration into the global economy will be key to Iraq’s reconstruction. By supporting the new Trade Bank of Iraq, which was created for precisely that purpose, OPIC’s financing will accelerate Iraq’s reconstruction and involve increasing numbers of international companies in the process,” said OPIC Acting President and CEO Ross Connelly. The Trade Bank of Iraq is an independent Iraqi government entity created to facilitate the reconstruction of Iraq by providing trade finance services that Iraqi financial institutions are currently unable to offer. The TBI, with capital of $100 million, began its operations in December 2003. OPIC was established as an agency of the U.S. government in 1971. It helps U.S. businesses invest overseas, fosters economic development in new and emerging markets, complements the private sector in managing risks associated with foreign direct investment, and supports U.S. foreign policy. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers. OPIC’s political risk insurance and financing help U.S. businesses of all sizes invest in more than 150 emerging markets and developing nations worldwide. Over the agency’s 33-year history, OPIC has supported $164 billion worth of investments that have helped developing countries to generate more than 732,000 host-country jobs and $13 billion in host-government revenues. OPIC projects have also generated $69 billion in U.S. exports and supported more than 264,000 American jobs. Source: Harold Doan © 2002-2004 Iraq Directory - All Rights Reserved