Foreign Secretary Marcelo Ebrard and Ryan Brennan, Chief Operating Officer at the Overseas Private Investment Corporation (OPIC), announced today that OPIC had taken the first steps towards investing in Mexico's development as agreed in a joint statement dated December 18, 2018.
OPIC, the U.S. government agency that mobilizes private capital, announced today with the Government of Mexico the first part of its plans to procure USD 4.8 billion of the financing needed for various private sector projects. This amount includes two billion dollars for southern Mexico.
Mexico presented a broad portfolio of investment projects. The 12 projects being evaluated for OPIC financing total USD 2.5 billion dollars.
At today's announcement, OPIC said it would work with local banks and microfinance institutions to provide USD 52 million for micro, small and medium-sized companies in southern Mexico. This money will mobilize an additional investment of USD 28 million, which will create jobs and boost prosperity in southern Mexico. This total of 80 million dollars will be invested using a gender approach. Priority will be given to financing projects led by women.
Chief Operating Officer Ryan Brennan spoke about the strength of OPIC's collaboration with Mexico, "one of our most important partners in the world. By supporting U.S. investment in high-impact sectors such as financial services and energy, these projects will create new economic opportunities in southern Mexico that will empower individuals and lift up communities." He thanked the Government of Mexico for its collaboration, saying it had been a great partner.
In addition, OPIC signed two letters of interest on financing for two projects in southern Mexico, subject to the successful completion of the agency’s extensive review process. The first, for USD 250 million, would lead to an investment of 150 million dollars more for the construction of a natural gas liquefaction plant. The second, for 240 million dollars, would trigger an additional investment of 80 million dollars to build a wind power plant in the region.
In all, this would amount to an investment of USD 800 million dollars in the country's southern region, whose development is a government priority. This investment is the first step in a series of collaborative development projects between the two countries. Mexico and OPIC will continue their collaboration for the rest of the funds that have been committed, as well.
Foreign Secretary Ebrard stressed that, for Mexico, it is clear that the U.S. government is taking seriously the commitment to ensure that people do not have to migrate because of poverty but rather because they decide to do so. He said he was happy that the final steps were being taken in record time to mobilize close to USD 800 million, which is a very large amount of money.
"This demonstrates that the relationship with the United States, which is very complex, is a good one, and that good agreements make good sense."
Also present at the announcement were the Undersecretary for North America, Jesús Seade; the Chargé d'Affaires of the U.S. embassy in Mexico, John Creamer; and the Director General of Bilateral Cooperation and Economic Relations, Carlos Castillo Pérez.
In a meeting held prior to the event, the head of Bancomext and Nafin, Eugenio Nájera Solórzano, said the Mexican government is "committed to contributing to economic growth and job creation in Mexico. Working with OPIC will be essential for Mexico's prosperity and development, and we are ready to continue participating in projects that benefit all Mexicans."
This major investment demonstrates in a tangible way the commitment of both the United States and Mexico to contribute to growth in the parts of the country that have received fewer financial opportunities in the past.