U.S. International Development Finance Corporation

All the supply chain work, it was all Air Force contracting officers and finance officers executing billions of dollars in things like masks and pipettes, and it wasn't just for the military, it was for the population.

But we were also assisting up this program called the Defense Production Act Loan Program through the Development Finance Corporation.

which is for everybody doesn't know what that is.

DFC is this is one of these few government banks that call them federal credit agencies.

DFC was formerly known as OPIC and then under the first Trump administration, shifted to the Development Finance Corporation, expanded the horizon on national security, but it was only focused on overseas work.

So we didn't really have a domestic variant of it.

And during the DPA program for COVID-19 relief, it was all domestic focus.

And the good news is this administration has done that.

The DFC and other programs, there's more money at play where we can get the pre-feasibility studies, the bankable feasibility studies done, go out and get private capital, and then move from there.

So I think those are good things, but I think we need to recognize that these countries are going to continue to trade with China We just need to be competing more effectively.

Do you foresee any more formalized or closer military relationships? And like we have NATO for Europe, we have some alliances in the PACOM.

Let's not get into this in detail, but one reason the US is doing this is because Vladimir Putin has proposed to sell the overseas assets of Lukoil, a Russian oil giant, to a consortium of investors with personal ties to Donald Trump's daughter.

And the U.S. International Development Finance Corporation, part of the U.S. government, is going to take a 15% minority stake.

So full details in the New York Times published on the 3rd of October.

That's against our interests.

Yes.

So the U.S. International Development Finance Corporation is really interested in funding more projects in the Western hemisphere because it is such a priority of the Trump administration, including oil and gas projects there.

But there are some limitations on where they can spend their money.

And right now, Venezuela is one of the places they cannot

We're beginning to see a lot of organizations who are committing to put some money into impact one way or another.

I had just come from what's now called the Development Finance Corporation, used to be called the Overseas Private Investment Corporation, which was the U.S. government's development bank.

And while I was there, we had dedicated a lot more of our resources to what we now call as impact investing.

And so what we believed at the time is that...

MCC is a U.S. government independent agency that invests in lower income, well-governed countries.

And what differentiates it from, say, what USAID did or we talked in our last episode about DFC? What is the primary thing or things that makes MCC different?

Great question.

So the first is that it's all grant funding.

So unlike DFC, where you're often paying back the loan, this is debt-free money.

And unlike USAID or like former USAID, it is laser focused on economic growth.

And so that means that it's often large infrastructure investments that coupled with policy reforms, but they're really focused on often a single sector that will unlock growth in a country, and it's often different based on the country context.

And so when an administration in a partner country is asked to do these very politically difficult reforms, I think it helps to be able to tell her or his people, I have to do it, otherwise we lose half a billion dollars in investment, in debt-free investment into the power sector.