Africa Regional Media Hub Press Briefing with OPIC Executive Vice President David S. Bohigian OPIC's Projects and Activities in Africa.
Africa Regional Media Hub
Press Briefing with
OPIC Executive Vice President David S. Bohigian
OPIC’s Projects and Activities in Africa
January 30, 2018
OPERATOR: Ladies and gentlemen, thanks for standing by and welcome to the OPIC in Africa conference call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. Instructions will be given at that time. If you should require outside assistance, you may press * then 0. As a reminder, today’s call is being recorded. Your hosting speaker, Tiffany Jackson-Zunker. Please go ahead.
MODERATOR: Good afternoon to everyone from the U.S. Department of State’s Africa Regional Media Hub. I would like to welcome our participants dialing in from across the continent and thank all of you for joining this discussion. Today, we are pleased to be joined from Washington D.C. by David S. Bohigian, the Executive Vice President of the Overseas Private Investment Corporation, or OPIC. OPIC is the U.S. Government’s development finance institution. Mr. Bohigian will discuss his recent visit to sub-Saharan Africa, as well as preview OPIC’s upcoming women’s initiative and agency priorities.
We will begin today’s call with opening remarks, then we will turn it to your questions. We will try to get to as many of them as we can during the time that we have, which is approximately 40 minutes. At any time during the call, if you would like to ask a question, you must press *1 on your phone to join the question and answer queue. If you would like to join the conversation on Twitter, please use the hashtag #OPICinAfrica and follow us on @africamediahub and @opicgov.
As a reminder, today’s call is on the record, and with that, I will turn it over to Executive Vice President Bohigian.
BOHIGIAN: Thank you so much, and thank you for joining today. As you know, I work with the Overseas Private Investment Corporation, or OPIC, which is the U.S. government’s development finance institution, which for almost 50 years has been helping emerging markets in developing countries around the world to have a stability at the societal level, country level, and the family level. We’ve got a longstanding commitment to Africa and its people. The Overseas Private Investment Corporation works across political risk insurance, private equity, and project finance and has a global portfolio of more than $23 billion, about $7 billion of which is in Africa, which is up over $5 billion over the last 15 years. We look to operate in markets that help countries develop by investing in those markets, and we are extremely encouraged by the potential Africa is showing. There’s strong economic growth, there’s amazing demographics, and the reforms being adopted to improve the business climate are helping innovation throughout the continent.
I led a delegation from the Overseas Private Investment Corporation to Ghana, Cameroon, and Togo earlier this month to help support the projects that we’re doing there. We’ve worked on everything from infrastructure to farming, and in this instance we went to Ghana to look at affordable housing, to Togo to look at a power plant, and Cameroon to look at an innovative eye care clinic. I want to talk about each one of those briefly.
In Ghana, we inaugurated a housing project at Apollonia City, about half an hour outside of the capital, working with GHL Bank, which is an OPIC client, to develop affordable housing in Ghana. This housing development is a wonderful example of what’s been called “the American dream” of homeownership, going global. To drive into that facility to see a Ghanaian flag, and an American flag, and a Ghanaian flag, and then talk to first-time homeowners who are joining a development that will include a school, a power plant, and even a water park is truly seeing an emerging Africa with a vibrant middle class that’s able to work and live in a way that hasn’t been achievable earlier.
Next we went to Togo, where we met with the Prime Minister and toured an OPIC-supported power plant. This power plant has tripled the amount of power available in Togo. That’s three times the energy supply, because of ContourGlobal, a U.S. company that built the Lomé thermal power plant. We supported that through financing and political risk insurance. It’s one of the largest investments ever made in Togo, and that energy generation capacity has both reduced blackouts and helped have a multiplier effect across the economy. Equally interesting in Togo was visiting a local school that ContourGlobal supports. There we saw the country’s first mobile STEM learning center, which is a van that allows students to work on computers and with 3D printers. It’s just a phenomenal work of the social project that ContourGlobal is working on.
Next, in Cameroon, we toured a facility that provides affordable eye care. OPIC is helping the Magrabi ICO Cameroon Eye Institute provide upwards of 18,000 cataract surgeries over the next 5 years to help cure blindness. To see that facility and talk to some of the patients was truly one of the more moving moments of my life. The patient there had been taken by bicycle by one of his friends to the facility, and after his surgery, after having been blind for more than 10 years, his family said to him, “Welcome back to life.” And it’s that kind of impact that OPIC has been developing for the past 50 years, almost.
They’ve also been deeply involved in innovation. I’m proud that the eye clinic is supported through a development impact loan, which is a results-based contract where investors provide financing, and then the more good that’s created - the more successful eye surgeries they have - the more investors get paid back. So we’re very proud of all these projects, we’ve got a renewed and continued commitment to working across Africa, and I’d be happy to take any questions about the trip or OPIC generally. Thank you.
MODERATOR: Thank you again, Mr. Bohigian. We will now begin the question and answer portion of today’s call. For those asking questions, please state your name and affiliation and limit yourself to one question related to the topic of today’s briefing: OPIC’s projects and activities in Africa.
For those of you listening to the call in English, please press *1 on your phone to join the question queue. Note you need to pick up the handset if you are using a speakerphone; this often inhibits our journalists from asking questions. For those of you listening to the call in French and Portuguese, we have received some of your questions submitted in advance by email. You may continue to submit your questions in English via email to email@example.com.
With that, I would like to ask the operator to open the line for Mr. Kevin Kelley.
QUESTION: Yeah, hello, am I on the line?
OPERATOR: Yes, your line’s open.
QUESTION: Okay, great. Well thanks a lot for doing this today, it’s quite interesting. So I’m wondering, in the past there’s been opposition in Congress to fully funding OPIC, to even funding it at all. I’m wondering what the status is [Inaudible] OPIC in the Trump administration, and also whether, Mr. Bohigian, during your travels in West Africa, you encountered any disgruntlement with the Trump administration, particularly regarding the president’s reported vulgar remarks about African countries? Okay, thank you.
BOHIGIAN: Thank you. I think OPIC has long enjoyed bipartisan support throughout Congress. During my confirmation process this summer, culminating in Ray Washburne and I being confirmed in August, it’s clear that on both sides of the aisle, people understand the importance of OPIC’s mission - whether that was Chairman Corker on the Foreign Relations Committee or Ranking Member Coons, I think both are committed to development finance and its role in creating prosperity around the world as a signal of America’s role in the world in the 21st century. I think that also carries over into the administration. Ray Washburne and I joined OPIC in order to build and modernize a great institution, and we think with additional tools in the 21st century we can continue to create more prosperity.
To your second question, the response to OPIC’s work in Africa was uniformly positive. When you’re talking to prime ministers, you’re focused on the ability to create jobs and the ability to create prosperity in these countries, and that’s what OPIC’s doing. So to be able to talk to political leaders and business leaders, it’s a reflection of the President’s Advisory Council on Doing Business in Africa. People want to deepen trade ties, they want to deepen investment ties, and OPIC’s at the forefront of that, so we were received very, very positively.
MODERATOR: Thank you. Our next question will go to the listening party at the U.S. embassy in Accra, Ghana. Operator, please open the line.
QUESTION: Hi, my name is Nana Oye. I report for the Goldstreet Business here in Accra. Mr. Bohigian, you said you commissioned the project at Apollonia City here in Accra. I would like to know if you’ve had the opportunity to meet government officials who are in charge of housing, because housing in Accra or in Ghana is a major challenge, it is not really affordable. If you did, did you get the opportunity to also advise them as to how they can provide affordable housing to Ghanaians?
BOHIGIAN: We talked to officials across the government sector, including the tribal chief under which this land falls in Apollonia City. And to the person, they were enthusiastic about the affordable housing that this project is creating half an hour outside of Accra. What’s particularly interesting is not only the houses themselves, but the financing that is making housing more affordable. The reforms that GHL Bank has undertaken not only help people in Apollonia City but it’s helped reduce mortgage wait times from what was more than a year when we started working with them to a matter of weeks right now. So not only are rates lower and more affordable, but the process of getting a loan has become much more accessible for thousands more people. In addition - and I hope you get a chance to get outside the capital to see the housing, which really is beautiful and will allow people to raise families and go to schools that are on the property, have reliable electricity, to play in the water park and be close to where they’re going to work as well. So I think that the reaction that I heard from businessmen, from government officials, and the homeowners themselves shows that this is a solution to affordable housing in Ghana.
MODERATOR: Thank you. Our next question will go to Emeka Eke, a journalist at Upstreaminsider in Nigeria. Operator, can you open the line, please?
OPERATOR: The line is open, please go ahead.
MODERATOR: Okay. We will instead turn to Samantha Payne of the African Review in the UK. If you could open that line, please?
OPERATOR: The line is open, please go ahead.
QUESTION: Hi, there, yes, I’d just like to know in what way is OPIC going to provide significant investment in Africa’s power sector, in continuing to secure the region’s economic development.
BOHIGIAN: Sure. OPIC, as I mentioned, has a longstanding commitment to Africa, where it’s gone from approximately $2 billion to $7 billion in our portfolio in the last 15 years. In 2017 alone, OPIC committed over $600 million to Africa across more than 20 projects, and supports multiple initiatives, from Feed the Future to Power Africa. Power Africa is something that we will continue to build on, which has been designed to double the access to electricity in sub-Saharan Africa, and we’re going to be looking across a range of all power types, full spectrum energy, such as we saw at ContourGlobal. I know that as a participant in the President’s Advisory Council on Doing Business in Africa, this administration and business leaders are also seeing opportunities there. And I think OPIC’s signal is important, that Africa is a place for investment and opportunity, and as people look to growth opportunity in the 21st century, Africa and the countries I visited, Ghana, Togo and Cameroon, represent that.
MODERATOR: Thank you. Next we will return to the listening party at the U.S. embassy in Accra, Ghana. Operator, please open the line.
QUESTION: Hi, my name is Belinda Ayamgha, I work for the Ghana News Agency. My question for Mr. Bohigian is he talked about investment in Africa, and in his intro he mentioned something about development, impact investment. I’d like to know how much of OPIC’s portfolio is going into impact investment, seeing as Africa, even though it rises, has a lot of challenges and the onus is on its teaming youth to be innovative and to find solutions to the many problems in Africa. So how is OPIC doing in Accra impact investment[Inaudible]? Thank you.
BOHIGIAN: That’s a great question. I think OPIC is one of the original impact investors. OPIC was created as a successor to one of the proudest moments in U.S. history, the Marshall Plan. The ability to create investment and opportunity throughout the world is something OPIC has been doing with impact investing for almost 50 years. OPIC’s goal is to advance U.S. foreign policy and development, and we think the investments that we’ve created have helped stabilize societies and have helped stabilize families. It’s amazing to think that - I’m going to talk about the Marshall Plan that was intended to help rebuild Europe - that Germany now has announced a Marshall Plan for Africa. So for a country to go from being an aid recipient to one of the economic powerhouses of the world, to being able to create its own program to promote trade investment, is what success looks like.
When we look at OPIC’s portfolio at more than $23 billion, I think of that as all impact investing, whether that’s $3.5 billion in our current portfolio of private equity, helping create more entrepreneurial environments and growing companies throughout the world, or whether that is where we started, in political risk insurance, helping to unlock investments that otherwise wouldn’t be made. The goal of OPIC has always been to have an impact, not just in Africa but across Latin America, Europe, Southeast Asia, and beyond.
MODERATOR: Thank you. Just a reminder, to ask a question, please press *1 on your phone. State your name and affiliation before asking your question, and limit yourself to the topic of today’s call. With that, I would like to ask the operator to go to Jonathan Koonings, Editorial Manager at Oxford Business Group in Kenya.
OPERATOR: Please go ahead, your line is open.
MODERATOR: Alright, we have a little bit of a difficulty hearing Jonathan. We’ll come back to him in just a moment. With that we will go back to the listening party in Ghana. Can you open the line, please?
QUESTION: My name is Emmanuel Dogbevi, I work for Ghana Business News. Talking about investing in housing in Ghana, with a housing deficit of almost more than a million, it doesn’t appear to me that targeting Apollonia is reaching out to people who need housing very badly and are unable to afford them. It appears the project in Apollonia is targeting a certain degree of middle class who are above the, who earn much more than most of the people who need housing. How can that, in reality, help to resolve the really, really menacing housing challenge in Ghana today?
BOHIGIAN: Thank you. Clearly, demand for affordable housing significantly exceeds supply in Ghana, where we believe the price of housing and a lack of access to financing remain significant barriers to homeownership. So Apollonia City is a piece of that puzzle, but clearly the demand is greater than what one project can clearly supply. What’s broader than Apollonia city is OPIC-supported GHL Bank, formerly known as Ghana Home Loan.
As I mentioned, GHL bank has played a pioneering role in the housing finance industry, including encouraging the passage of mortgage-friendly legislation on evictions and foreclosures, including reducing processing times, and it’s those kinds of reforms that have a multiplier effect across the economy. To be able to lower rates and make homes more affordable to all, to reduce processing time, to have mortgage-friendly legislation, is broader than Apollonia City alone. It’s having a ripple effect across the entire housing market, throughout Ghana, and I’d argue across the world.
MODERATOR: Great, thank you. Our next question was received by email from David Herbling of Bloomberg in Nairobi. He asks, what is your outlook for Kenya or East Africa in general, and what is your financing deals pipeline for this year for Kenya? How much do you plan to invest, and in which companies?
BOHIGIAN: Today I don’t have specific figures on Kenya, nor do we break out our portfolio for East Africa. As I mentioned, last year alone we committed more than $600 million to the region and did 22 projects, but the pipeline as of today is strong, but investments themselves will be approved through our Credit Committee, through our Investment Committee, through our Board, and so I don’t have the ability to talk today about what the investment portfolio will look like in 2018.
MODERATOR: Alright. We will return to Emeka Eke in Nigeria. Operator, can you open the line, please?
OPERATOR: Your line is open, please go ahead.
MODERATOR: Okay, we’re having some difficulty there. We will now turn to Jonathan Koonings again, in the UK. Can you open that line, please?
QUESTION: Is my line on?
OPERATOR: Yes, your line is open.
QUESTION: Okay. As external public and publicly guaranteed debt stock increases for African markets, what measures have been taken to ensure that countries do not move back to their pre-Heavily Indebted Poor Countries relief levels?
BOHIGIAN: I’m sorry, can you repeat the question so I make sure I’ve got it right?
QUESTION: As external public and publicly guaranteed debt stock increases for African markets, what measures have you taken to ensure that such countries do not move back to pre-Heavily Indebted Poor Country debt relief levels?
BOHIGIAN: Thank you for that question. Clearly there is strong economic growth throughout Africa, and we hope that the reforms that we talked about with government officials help the countries in the region move up in the attractiveness to investors, as is indicated in the Doing Business survey done by the World Bank and others. I think that when you look at a country’s competitiveness, you look at the demographics of the people, which is incredibly strong in Africa, when you look at the innovation potential, you look at the education levels, and all of those are trending in the right direction for the countries we visited. So I hope that as they undertake reforms at the government level, as well as OPIC’s initiative to help support women and families throughout Africa and the world, we think that more stable societies and more stable families will help the development cycle continue toward opportunities.
MODERATOR: Thank you. Our next question was submitted via email from Geoff Hill, the Africa correspondent at The Washington Times. He noted, “In Cape Town last year, Energy Secretary Rick Perry said the U.S. was committed to helping lift Africa to U.S. levels of power so factories can open, reducing employment. Could you give us an idea of where the private sector might help with this, and considering much of the new power in southern Africa is coal-based and not using clean tech, can the U.S. and OPIC in particular be involved in any way to help Africa burn coal more cleanly?”
BOHIGIAN: We continue to build on the U.S. government-wide success in Power Africa, which includes the Overseas Private Investment Corporation, USAID, the State Department, the Department of Energy, and other stakeholders, to bring energy throughout Africa. We’re building on that through additional investments across the whole spectrum of energy, that have included renewables and obviously with ContourGlobal and others, thermal power as well. So we will continue to work with private sector investors to look for projects that support energy which we believe helps build more stable societies, and ContourGlobal is a great example of that, as I mentioned, tripling the power available to the Togolese, and we’ll look to work with great American companies and great global companies to continue to address Africa’s power needs.
MODERATOR: Thank you very much. We will try one last time to reach Emeka Eke in Nigeria. Operator, can you open the line, please?
OPERATOR: Yes, go ahead, sir, your line is open.
QUESTION: Okay. This is Emeka Eke from Upstreaminsider in Nigeria. My question is, Africa has become an attractive investment hub [Inaudible]. So I want to know how these investments impact Africa positively, because by now [Inaudible] most investments made in Africa you don’t really see them benefit Africa as a continent, so we’re looking to see how that [Inaudible], so I’d like to know how these future investments coming in change [Inaudible] how is Africa benefitting, what other investments being made here? Thank you.
BOHIGIAN: I’m sorry, I really had trouble with most of that, can you try and summarize the question?
QUESTION: Alright. I asked, Africa has become an attractive investment hub…
QUESTION: [Inaudible] Yeah, now the question is this. More often than not, these investments that are made in Africa don’t really benefit Africa as a continent. How will that direction change? How can that change the whole situation in Africa, so that the countries in really needy situation whereby the investors who come to make the investments benefit as well as the continent where they are making investments also benefit? Thank you.
BOHIGIAN: I think the question goes to Africa as a region, versus investment on a country-by-country basis, is that right?
QUESTION: Yeah, you could say, yeah.
BOHIGIAN: Okay. I think clearly every country has different opportunities and different challenges. When we talk to the folks in Togo, they’re interested in becoming a regional logistics hub. Every country is looking to have a comparative advantage versus the others, not just in the region but globally. So I think each country needs to develop its own strengths and overcome its own challenges. Again, look at the Doing Business report; measures such as education, innovation are what attract investors, and measures like corruption or slow logistics or poor customs operations deter investors. And each country needs to undergo economic reform in order to make themselves more attractive to investors.
Clearly there are regional initiatives, whether that be through trade or investment or logistics, that can help markets become even more attractive at a regional level, whether those are border crossings or new airports or the ability to move goods more efficiently across borders, it will also help improve the region as a whole. So I think there’s room for both, work at the country level as well as the regional level, and I hope that continued cooperation between the United States, individual countries, and throughout the region, creates a multiplier effect for growth.
MODERATOR: Thank you very much. We have far too many questions that have been sent in, and our guests I’m sure have many more, but we do have to wrap it up today. Mr. Bohigian, do you have any closing remarks you’d like to give?
QUESTION: No, I’ll just say that the administration and Congress and the business community recognize Africa as a tremendous opportunity. We look forward to deepening our ties to create investment and the stability that goes along with it. OPIC in particular remains committed to the region and we’ll look forward to continuing to grow our portfolio, and thank you all today for your time.
MODERATOR: Thank you, and with that, that concludes today’s call. I want to thank David Bohigian, the Executive Vice President of OPIC, for joining us, and thank all of our callers for participating. If you have any questions about today’s call, you may contact the Africa Regional Media Hub at firstname.lastname@example.org. Thank you.