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The US government has a large number of existing tools, policy options, and institutions to encourage entrepreneurship and commercial activity abroad. The Overseas Private Investment Corporation (OPIC), a government agency created in 1971 to mobilize private capital in developing countries, is the core institution. However, these tools have not been deployed in an efficient or strategic manner. This underperformance is largely because OPIC is severely constrained by outdated rules and because many needed tools are spread across other federal agencies. The lack of authorization of necessary investment tools used by competing overseas peer institutions, fragmentation of effort, and lack of cohesion across multiple agencies means that the sum of these parts is far less than optimal for both American and developing country interests. These inefficiencies indicate that the United States is (1) losing out to other countries on potential commercial opportunities in the next wave of emerging markets; and (2) neglecting key levers to support prosperity and stability abroad.
A strengthened OPIC—more efficiently deploying existing tools at no additional budget cost—would (1) increase US commercial access in emerging economies, (2) reflect economic, social, and political priorities in developing countries, (3) promote flagship US initiatives during austere budget conditions, and (4) support stability in fragile or frontline states.