US government backs loans to small businesses in Iraq (06/04/05)

This year, the US government will help more than 100,000 American small businesses obtain access to capital through SBA loans. Now it wants to help grow small and medium-size businesses in Iraq.

OPIC president and CEO Ross Connelly

The Overseas Private Investment Corp., a federal agency that backs investments in developing countries, teamed with Citigroup to establish a $131 million loan program in Iraq. Iraqi financial institutions will tap these funds to make loans to small and medium-sized businesses.

"This facility is critical as a first step toward rejuvenating the private sector of Iraq as it strives to tap the capital markets," says Ross Connelly, OPIC's acting president and CEO.

OPIC provides political risk insurance, loans and loan guaranties to American businesses that invest in new and emerging markets. Fees cover the costs of its programs.

The agency also will pick a manager soon for a private equity investment fund that will invest in technology-based businesses in emerging markets. The purpose of the fund is to "bridge the digital divide in developing countries," according to the agency.

Source: Bizjournals