Written by: Kelli Liegel
In today’s highly-polarized political climate, it is rare to see overwhelming bipartisan support regarding policy issues. Defying this norm, on February 27th, Ted Yoho (R-FL), Adam Smith (D-WA), Bob Corker (R-TN), and Chris Coons (D-DE) introduced a new bill to Congress that they believe everyone can get behind. The BUILD Act, which stands for Better Utilization of Investments Leading to Development, is an innovative way to bring tens of billions of new private-sector dollars into the fight against extreme poverty. The bill would streamline several federal programs, including the Overseas Private Investment Corporation (OPIC), into a new Development Finance Corporation (DFC) which would make loans, invest, and forge partnerships with entrepreneurs who want to do business in developing countries. This bill has increasingly gained traction, including in Wisconsin, with Representatives Mike Gallagher, Mark Pocan, and Ron Kind committing to co-sponsor the bill alongside 25 other Congress members who have added their name to the list.
Why does this legislation matter? The importance of this bill can be seen on a domestic as well as an international level. Focusing first on the domestic advantage, this bill delivers on strengthening soft diplomacy, national security, and the economy. Soft diplomacy is a necessary strategy the United States must focus on when interacting with developing countries. As these countries grow and become self-sustaining, it is in the United States interest that they adopt standards and values similar to those of capitalist democracies around the world, as opposed to those of countries who do not offer the same freedom to their citizens like China or Russia. The BUILD Act does this by strengthening the relationship between the United States and countries in which investments are made. Investing in developing countries creates an environment of economic stability, creating a safer country, safer world, and safer U.S.
In the global economy, countries like China have emerged and substantially increased investment in developing countries, outscoring the U.S. in financing. Now more than ever is a critical time for the United States to show it will continue to be the global leader in foreign investment. Right now the U.S. is unable to lead in foreign direct investment (FDI) since the OPIC cap is around 30 billion, but the BUILD Act will double this to a cap to 60 billion. Being the global leader in FDI would strengthen soft diplomacy; having the most significant stake in foreign investment translates to having the greatest influence on a developing country’s values.
If the United States wants to distinguish itself as a global leader, the time to act is now. The BUILD Act encourages entrepreneurship in developing countries while simultaneously bolstering sustainable development by promoting private investment and job creation overseas. The DFC will continue to bring money into the U.S. treasury, as OPIC has done, instead of costing taxpayers money. This much-needed update to OPIC makes sense and cents for the U.S.