United States of America is hereby pledged for the full payment and performance of such obligations.

(e)(1) 143 There is hereby authorized to be appropriated to the President such amounts, to remain available until expended, as may be necessary from time to time to carry out the purposes of this title.

(2) 143 (A) In order to meet obligations incurred for the payment of claims pursuant to loan guaranties described in subsection (d), the Administrator of the agency primarily responsible for administering part I may, to the extent that reserves are not sufficient, borrow from time to time from the Treasury except that

(i) the Administrator may exercise the authority to borrow under this paragraph only to such extent or in such amounts as are provided in advance in appropriation Acts; and

(ii) the amount borrowed under this paragraph which is outstanding at any one time may not exceed $100,000,000.144 (B) Any such borrowing shall bear interest at a rate determined by the Secretary of the Treasury, taking into account the current average market yield on outstanding marketable obligations of the United States of comparable maturities. The Secretary of the Treasury shall make loans under this paragraph and for such purpose may borrow on the credit of the United States in accordance with subchapter I of chapter 31 of title 31 of the United States Code.

(f) In the case of any loan investment guaranteed under 133 section 222, the agency primarily responsible for administering part I shall prescribe the maximum rate of interest allowable to the eligible investor, which maximum rate shall not exceed by more than 1 per centum the then current rate of interest applicable to housing mortgages insured by the Department of Housing and Urban Development. 145 The maximum allowable rate of interest under this subsection shall be prescribed by the agency as of the date the project covered by the investment is officially authorized and, prior to the execution of the contract, the agency may amend such rate at its discretion, consistent with the provisions of subsection (f).

(g) Housing guaranties committed, authorized, or outstanding heretofore under this title or 146 under prior housing guaranty authorities repealed by the Foreign Assistance Act of 1969 shall continue subject to provisions of law originally applicable thereto and

143 The para. designation “(1)" and a new para. (2) were added by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 311(c) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 311 of H.R. 5119.

144 $100,000,000 was substituted in lieu of $40,000,000 by title II of the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1988 (sec. 101(e) of the Continuing Appropriations for 1988, Public Law 100-202, 101 Stat. 1329).

Title II of the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1989, (Public Law 100-461, 102 Stat. 2268) provided: "That pursuant to sec. 223(e)(2) borrowing authority provided therein may be exercised in such amounts as may be necessary to retain an adequate level of contingency reserves for the fiscal year 1989."

145 Language which specified that the maximum rate of interest should not be less than onehalf of 1 per centum above the then current rate of interest applicable to housing_mortgages insured by HUD, was struck out by sec. 112(c) of the International Development Cooperation Act of 1979 (Public Law 96-53, 93 Stat. 364).

146 The words "heretofore under this title or" were added by sec. 115(h) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 951).

fees collected hereafter with respect to such guaranties shall be available for the purposes specified in subsection (b).

(h) No payment may be made under any guaranty issued pursuant to this title for any loss arising out of fraud or misrepresentation for which the party seeking payment is responsible.

(i) 147 *

* *

[Repealed-1978]

(j) 148 Guaranties shall be issued under section 222 133 only for housing projects which are coordinated with and complementary to any development assistance being furnished under chapter 1 of this part and which 149 are specifically designed to demonstrate the feasibility and suitability of particular kinds of housing or of financial or other institutional arrangements. Of the aggregate face value of housing guaranties hereafter issued under this title, not less than 90 per centum shall be issued for housing suitable for families with income below the median income (below the median urban income for housing in urban areas) in the country in which the housing is located. The face value of guaranties issued with respect to housing in any country shall not exceed $25,000,000 in any fiscal year, and the average face value of guaranties issued in any fiscal year shall not exceed $15,000,000. Of the total amount of housing guaranties authorized to be issued under section 222 through September 30, 1982, not less than a face amount of $25,000,000 shall be issued for projects in Israel and not less than a face amount of $25,000,000 shall be issued for projects in Egypt.150

Sec. 224.151 Trade Credit Insurance Program.-(a) In order to enable the Export-Import Bank of the United States (hereafter in this section referred to as the "Bank") to determine that there exists reasonable assurance of repayment as required under section 2(b)(1)(B) of the Export-Import Bank Act of 1945, 152 the agency primarily responsible for administering part I of this Act (hereafter in this section referred to as the "Agency") is authorized to provide guarantees to the Bank for liabilities to be incurred by the Bank in connection with guarantees or insurance provided under the Export-Import Bank Act of 1945 for financing for transactions involving the export of goods and services for the use of the private sector in Central American countries.

147 Subsec. (i), which had authorized sections 221 and 222 to continue in force until Sept. 30, 1979, was repealed by sec. 115(i) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 952).

148 Sec. 311(5)(B) of Public Law 94-161 (89 Stat. 849) added subsection (j).

149 The words to this point beginning with "are coordinated with and" were substituted by sec. 112(d)(1) of the International Development Cooperation Act of 1979 (Public Law 96-53, 93 Stat. 364) in lieu of the following: "(1) except for regional projects are in countries which are receiving, or which in the previous two fiscal years have received, development assistance under chapter 1 of part I of this Act, (2) are coordinated with and complementary to such assistance, and (3)".

150 This sentence was amended and restated by sec. 112(d)(2) of the International Development Cooperation Act of 1979 (Public Law 96-53, 93 Stat. 364). It formerly read as follows:

"Notwithstanding the provisions of the first sentence of this subsection, the President is authorized to issue housing guaranties until September 30, 1978, as follows: In Israel, not exceeding a face amount of $75,000,000, in Portugal, not exceeding a face amount of $30,000,000, and in Lebanon, not exceeding a face amount of $30,000,000."

151 22 U.S.C. 2184. Sec. 224 was added by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 1011 of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 1011 of H.R. 5119.

152 For text, see vol. III., sec. I.

(b)(1) Guarantees provided by the Agency pursuant to the authority of subsection (a) shall be for short-term guarantees and insurance extended by the Bank which shall be repayable within a period not to exceed one year from the date of arrival at the port of importation of the goods and services covered by such guarantees or insurance. Guarantees or insurance extended by the Bank and guaranteed by the Agency pursuant to subsection (a) shall be provided by the Bank in accordance with criteria and procedures agreed to by the Agency and the Bank. Such agreement shall also provide for the establishment of a reserve fund by the Agency, with such funds made available to the reserve as the Agency deems necessary to discharge liabilities under guarantees provided by the Agency pursuant to subsection (a).

(2) The administrator of such agency shall transmit a copy of such agreement to the Speaker of the House of Representatives and to the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate.

(c) The Agency shall not enter into any commitments to guarantee under subsection (a) after September 30, 1989.

(d) of the funds authorized to be appropriated for chapter 4 of part II of this Act, there are authorized to be made available such sums as may be deemed necessary by the Agency to discharge liabilities under guarantees entered into under subsection (a).

(e) Commitments to guarantee under subsection (a) are authorized only to the extent and in the amounts provided in appropriations Acts, except that the aggregate amount of outstanding commitments under subsection (a) may not exceed $300,000,000 of contingent liability for loan principal during fiscal year 1986 and may not exceed $400,000,000 of contingent liability for loan principal during fiscal year 1987.153

(f) To the extent that any of the funds made available pursuant to subsection (d) are paid out for a claim arising out of liabilities guaranteed under subsection (a), amounts received after the date of such payment, with respect to such claim, shall be credited to the reserve fund referred to in subsection (b), shall be merged with the funds in such reserve, and shall be available for the purpose of payments by the Agency to the Bank for guarantees under subsection (a).

(g) Beginning on a date six months after the date of enactment of this section, and at intervals of six months thereafter, the administrator of the agency primarily responsible for administering part I of this Act and the President of the Export-Import Bank of the United States shall prepare and transmit to the Speaker of the House of Representatives and the Chairman of the Committee on

153 Sec. 314 of the International Security and Development Cooperation Act of 1985 substituted the text following the word "Acts," in lieu of the words "not to exceed $300,000,000 in the fiscal year 1985.". The Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1989 (Public Law 100-461, 102 Stat. 2268) provided the following:

"TRADE CREDIT INSURANCE PROGRAM

"During fiscal year 1989, total commitments to guarantee or insure loans for the "Trade Credit Insurance Program' shall not exceed $200,000,000 of contingent liability for loan principal."

Foreign Relations of the Senate a report on the amount and extension of credits during the preceding six-month period.

(h) The Export-Import Bank shall provide without reimbursement such administrative and technical assistance to the Agency as the Bank and the Agency deem appropriate to assist the Agency in carrying out this section.

Title IV-Overseas Private Investment Corporation 154

Sec. 231.155 Creation, Purpose and Policy. To mobilize and facilitate the participation of United States private capital and skills in the economic and social development 156 of less developed friendly countries and areas, thereby complementing the development assistance objectives of the United States, there is hereby created the Overseas Private Investment Corporation (hereinafter called the "Corporation"), which shall be an agency of the United States under the policy guidance of the Secretary of State.

The 157 Corporation, in determining whether to provide insurance, financing, or reinsurance for a project, shall especially

(1) be guided by the economic and social development impact and benefits of such a project and the ways in which such a project complements, or is compatible with, other development assistance programs or projects of the United States or other donors;

(2) give preferential consideration to investment projects in less developed countries that have per capita incomes of $984 or less in 1986 United States dollars, and restrict its activities with respect to investment projects in less developed countries that have per capita incomes of $4,269 or more in 1986 United States dollars (other than countries designated as beneficiary countries under section 212 of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2702)); and 158

154 A new title IV was added by sec. 105 of the FA Act of 1969. Prior to this, title IV had been titled "Surveys of Investment Opportunities." For Executive Order concerning OPIC, see page 766.

Title IV was amended extensively by title I of S. 2757 and title I of H.R. 5263, both enacted by reference in the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1989 (Public Law 100-461, 102 Stat. 2268):

"SEC. 555. Provided further, That title I of H.R. 5263 as passed by the House of Representatives on September 20, 1988, is hereby enacted into law: Provided further, That purchases, investments or other acquisitions of equity by the fund created by section 104 of H.R. 5263 as hereby enacted are limited to such amounts as may be provided in advance in appropriations Acts: Provided further, That notwithstanding any other provision of this Act, titles I and III of S. 2757 as reported by the Senate Committee on Foreign Relations on September 7, 1988, are hereby enacted into law: Provided further, That purchases, investments or other acquisitions of equity by the fund created by section 104 of S. 2757 as hereby enacted are limited to such amounts as may be provided in advance in appropriations Acts:

Except in two instances, title I, S. 2757 and title I, H.R. 5263 are identical. Sec. 106 in each title amended sec. 235(a)(2) of the FA Act of 1961. Sec. 235(a)(2) was previously amended by Public Law 100-418, sec. 2203(b)(1)A); H.R. 5263 took this into account. See page 86. Public Law 100-418, sec. 2203(b)(1)(B) redesignated sec. 235(a)(5) of the FA Act of 1961 as sec. 235(a)(6). Sec. 107 in S. 2757 and H.R. 5263 amended this section, but H.R. 5263 took into account the redesignation by Public Law 100-418. See page 87. Title III of S. 2757, which addresses the implementation of certain USIA Exchange Visitor Programs, is in vol. II, sec. E.

155 22 U.S.C. 2191. Sec. 231 was added by sec. 105 of the FA Act of 1969.

156 Sec. 2(1)(A) of the OPIC Amendments Act of 1974 (Public Law 93-390, 83 Stat. 809) substituted "development" in lieu of "progress".

157 This paragraph was added by sec. 2(1) of Public Law 95-268 (92 Stat. 213).

158 The per capita income levels were increased from $896 and $3,887 in 1983 U.S. dollars by sec. 102, of the OPIC Amendments Act of 1988, S. 2757, enacted into law by reference in the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1989 (Public

Continued

(3) 159 ensures that the project is consistent with the provisions of section 117 159 (as so redesignated by the Special Foreign Assistance Act of 1986), section 118, and section 119 of this Act relating to the environment and natural resources of, and tropical forests and endangered species 159 in, developing countries, and consistent with the intent of regulations issued pursuant to sections 118 and 119 of this Act.

In carrying out its purpose, the Corporation, utilizing broad criteria, shall undertake―

(a) 160 to conduct financing, insurance, and reinsurance operations on a self-sustaining basis, taking into account in its financing operations the economic and financial soundness of projects;

(b) to utilize private credit and investment institutions and the Corporation's guaranty authority as the principal means of mobilizing capital investment funds;

(c) to broaden private participation and revolve its funds through selling its direct investments to private investors whenever it can appropriately do so on satisfactory terms;

(d) to conduct its insurance operations with due regard to principles of risk management including 161 efforts to share its insurance risks and reinsurance 162 risks;

(e) 163 to the maximum degree possible consistent with its purposes

(1) to give preferential consideration in its investment insurance, reinsurance, and guaranty activities to investment projects sponsored by or involving United States small business; and

(2) to increase the proportion of projects sponsored by or significantly involving United States small business to at least 30 percent of all projects insured, reinsured, or guaranteed by the Corporation;

Law 100-461, 102 Stat. 2268). Sec. 102 also added "(other than countries designated as beneficiary countries under section 212 of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2702))". Previously the per capita income levels were increased from $680 and $2,950 in 1979 U.S. dollars to $896 and $3,887 in 1983 U.S. dollars by sec. 3 of the OPIC Amendments Act of 1985 (Public Law 99-204, 99 Stat. 1669), and from $520 and $1,000 in 1975 U.S. dollars to $680 and $2,950 in 1979 U.S. dollars, respectively, by sec. 2(1) of the OPIC Amendments Act of 1981 (Public Law 97-65, 95 Stat. 1021).

159 Par. (3) was added by sec. 4(a)(1)(C) of the OPIC Amendments Act of 1985 (Public Law 99204, 99 Stat. 1669). The OPIC Amendments Act of 1988, S. 2757, enacted into law by reference in the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1989 (Public Law 100-461, 102 Stat. 2268) made a correction to include section 117. S. 2757 also struck out "biological diversity" and inserted in lieu thereof "tropical forests and endangered species". 160 Subsec. (a) was amended by sec. 2(1)(B) of the OPIC Amendments Act of 1974 (Public Law 93-390, 83 Stat. 809). It formerly read as follows: “(a) to conduct financial soundness of projects and the availability of financing from other sources on appropriate terms;".

161 Sec. 2(1)(C) of the OPIC Amendments Act of 1974 (Public Law 93-390) struck the words, "when appropriate," which appeared at this point.

162 Sec. 2(1XC) of the OPIC Amendments Act of 1974 (Public Law 93-390) added the words "and reinsurance".

163 Subsec. (e), as amended by Public Law 93-390, was amended and restated by sec. 2(2) of Public Law 95-268 (92 Stat. 213). It formerly read as follows:

"(e) to give preferential consideration in its investment insurance, financing, and reinsurance activities (to the maximum extent practicable consistent with the Corporation's purposes) to investment projects involving businesses of not more than $2,500,000 net worth or with not more than $7,500,000 in total assets;".