A Conversation With Adam Boehler

U.S. International Development Finance Corporation CEO Adam Boehler discusses investments important to U.S. foreign policy and national security and the actions the agency is taking to advance those interests.

HOCHBERG:  I'm Fred Hochberg, a member of the Council on Foreign Relations, formally Chairman and President of the Export–Import Bank. And I'm delighted today to be the presider with a conversation with Adam Boehler, who was the first CEO of the Development Finance Corporation, and was confirmed about a little over a year ago by the U.S. Senate, a rare thing to get a confirmed appointee in this in the administration, so excited by that. And Adam brings us extensive experience in healthcare, both in the private sector and at HHS, works closely with the White House and the State Department, he's also founded three startups who's very knowledgeable about the private sector. And the only, I'm going to start with one easy question, Adam. You were born outside of Albany—what does that mean outside of Albany? Well, small, small town outside of Albany?

BOEHLER:  (Laughs.) The, uh, that's funny. There—there, yes, there are some towns outside the city. Yeah, I was born in a town called Guilderland. So yeah, it's a—

HOCHBERG:  How many people?

BOEHLER:  That's a good question actually, I don't know how many. Maybe like in the—I'm making this up, sort of, but maybe like 20,000 range.

HOCHBERG:  Okay, that's not too bad. All right. Well, I'm delighted. We're going to have a conversation for about thirty minutes, then we'll open to our members for question and answer. And a little hint, if you're—when you think of a question, you can raise your hand, you'll just be in the queue for when we start the Q&A portion of today's meeting, and we're going to end promptly at 4:00. So Adam, the Development Finance Corporation of the International Development Finance Corporation was a result of the BUILD act. And as, sort of, you're the successor of the OPIC, the Overseas Private Investment Corporation. So maybe you could take a moment, because I imagine many people who are participants today, we have over 250 registered, you're a hot topic of what the difference is—this new and improved version of delve and finance. So could you talk about that briefly?

BOEHLER:  Yeah, you got it friend. I think there's a couple things that are different. Number one is Congress doubled the size of the agency—so there was thirty billion dollars authorized, now there's sixty billion. The second thing is they gave the addition of a third product. So before, we did reinsurance, we did debt. And then they added a third product, which is equity investment. And then finally, and this is relatively important, I think, from the foreign policy perspective, is it used to be that OPIC always had to have a U.S. kind of home, a U.S. private investor. And what Congress did is they shifted that so that a U.S. investor is preferred, but not mandatory. And so you know, just to take a step back so that everybody understands what we are, we're kind of America's development bank, sixty billion organization investing abroad. And I think that the last change I mentioned, and they also gave us the ability to do technical systems and a few other things. So those are kind of the main things but there's a bunch of others.

The last aspect, Fred, I think is so important in terms of whether there's a U.S. base, because if you look at DFC's mission, it is very clear from a bipartisan perspective that it's threefold. Number one to invest in development, number two to advance U.S. foreign policy, and number three to return money to the American taxpayer. So those are our three, kind of, the triple aim of the DFC. I think that the second one under OPIC was relatively difficult. And the reason I say that is, you know, let's say you're looking and you decide well, or not just you, but let's say the interagency state, NSC. And they say, well, you know, Laos was critically important to U.S. foreign policy, because of China's influence there. Well, if we went then to Laos, and we looked at projects, and I was forced to always have a U.S. domicile, if there are no contractors bidding on something in Laos, which, by the way, in the United States, that would be a decent example, then you can't do work there. So what ended up happening to OPIC in some ways, was that it was always reactive, because why go and source deals in Laos if you're not going to be able to match it's wasted effort. And so, that change I think, lets us orient much more toward foreign policy.

And let me use one other example and then turn it back to you, Fred, because I don't talk too long about it. When I took the role, because one aspect of what we do is foreign policy, and one aspect is partly in response to the Belt and Road initiative in China, one thing that was surprising coming in was the port in Haifa that is operated by the Chinese, right. The Israelis are pretty good friends, and you know that, as you may imagine, represents a bit of an issue, something I brought up to [Benjamin] Netanyahu multiple times. But the Israeli answer was, well, when we went out and we went to bed, where was OPIC? And there were no U.S. bidders to operate the port, which is fair, that's true. Under today's circumstances, I don't think that would have to happen using DFC. And so I think Congress was very thoughtful in modernizing the agency to use it in this triple aim way, and that did free up the second the foreign policy aspect.

HOCHBERG:  Is that more in line with your competing development finance agencies in other countries?

BOEHLER:  Yes, I think, we were one of the only ones that were tethered 100 percent exclusively to domestic investment. The only one that I can think of that is still like that, although evolving pretty quickly, is Japan—is JBIC. But almost every other DFI in the world is not tethered. Now, let me be clear, because not only is it mandate, but it's our belief in how we operate. If there is a U.S.-based company that is interested in the project, we do prefer that, we do orient toward that, that's part of our job. But in many there are not necessarily, you know, depending on what it looks like. So that did modernize us and did put us more on par with other DFIs, as we're out there competing.

HOCHBERG:  And how many other DFIs are there roughly, just for our audience?

BOEHLER:  Oh, that's actually a good question. I don't know the answer. There are dozens and dozens of DFIs. You know, and then you know, I'll just note a few of the larger either multilaterals or country ones. The World Bank has a large DFI. And by the way, we frequently partner with our ally DFI. So the World Bank DFI is a perfect example. We have our Western Hemisphere DFI that the United States is invested in as well. IDB that Mauricio from NSC was just elected president of, so that's another good example. You have the African Development Bank, which is large. Asian Development Bank, which is large. And then from a bilateral country perspective, the Brits and the Japs are both folks that we partner with quite a bit.

HOCHBERG:  You mentioned, since you already mentioned the Belt and Road—you jumped ahead of my questions—how much of this is to find a counterweight to China and the Belt and Road initiative?

BOEHLER:  I think it's an important aspect. And you know, what I always orient for us, for our policy, is we don't make policy in response, right? I think we, I always believe in the United States, we're the strongest nation in the world. And we orient toward our policy first, and where our strengths are, well, of course, considering others. So I do think it's important that our tools that we have are on par. Just like you know, in a war, you don't want to be out operating with planes that are not just as good, if not better, than your competitors. Same thing here. You want to have the same amount of hardware that others have. But then from a strategy perspective, I tend to focus offensively on what we want to do, while considering what China's doing as well.

HOCHBERG:  Since you seem to have a closer connection now with the State Department, based on the BUILD act, I thought of the old OPIC had a lot to do with poverty reduction and sustainable development goals. So is there a little bit of a movement away from that and more aligned with sort of foreign policy initiatives in the reconstituted DFC?

BOEHLER:  I think that those two aspects, and then the third of taxpayer reducing deficit, are not mutually exclusive in any way. In fact, I find they build on each other, not to use the BUILD act, but the—here are my thoughts—number one, first and foremost, we are a development agency, right. It's in our name. And so we continue to focus on development, and what does that mean? That means, driving employment, increasing per capita GDP, focused on issues like women's employment and empowerment, etc., right. So that is critical to our mission. The foreign policy side, and one reason why I think they're so aligned, is when you're thinking about foreign policy, and when you're thinking about how you make a difference in foreign policy, you don't make a difference, I think, by spraying money all over the place. You make a difference by being thoughtful, and strategic, and somewhat focused. That is also how you make a difference in development. When you think about development, finance, strategically, from a system perspective—so, what I mean by that is, I can go and I can do, you know, a renewable energy project—a wind farm, let's say, in Sub-Saharan Africa—in its own right, as a single deal, that's fine, and we look at those all the time.

But isn't it much more interesting to concentrate in efforts in a system-wide basis and not think about just a wind farm, but a broader scope of renewable energy, a broader scope of projects, and then, by the way, because you're the money of the U.S. government here, to start to talk and to use that position to discuss how policy could be changed at the head-of-state level. And, by what I mean, there, again, is, in my opinion, one of the strongest aspects of the United States, is our private market. And one of the strongest aspects of our foreign policy is pushing toward markets that are free, that are competitive, and that follow rule of law, right? Strong competitive markets tend to result in the outcomes that we want. We have the ability when we go to countries because we have so much money, and because we are the United States, to pursue those conversations because, one of the things I've noticed in development is, we hear a lot how, you know, there's two trillion dollars of infrastructure dollars gap. But then sometimes deals are hard to come by. Why is that? The reason there's that gap, the reason, on one side, there's 2 trillion dollars of need. And on the other side, I don't have enough deals to put that capital to work, is because there isn't the environment for private market to operate. So there are not as many backable deals.

So, one of the things and I worked very closely, for example, with Felipe at IFC, that's the World Bank DFI, to say, listen, we can invest billions of dollars in this country. But we don't force our private market to invest. That's not how the United States or others operate with some exceptions in other countries. But why don't we change policy? Why don't we shift policies to open up the market? And if we do that—if you do that—then we can drive capital. And by the way, this isn't me telling you what to do—you're a sovereign country. It's me telling you what we can respond to from a private market perspective. So all of this to say, a foreign policy orientation and a concentration, in my opinion, lends itself very well to systematic development, instead of one-off development, and the two feed each other.

HOCHBERG:  So, with some of the initiatives—you mentioned Laos, for example—in terms of democracy reform, those kinds of things, would that be part of the requirement that we might want to see in that country? Or more just be seen as a good citizen, and helping them develop?

BOEHLER:  So I think it depends, everything is thematic, right? And so, you know, speaking about Lao, let's say, for example, or, you know, let me broaden Lao, because I think Lao in its own right is difficult to address very specifically, but let's talk about the Mekong region. Right. So what is in the United States interest from and this is, again, not just me speaking, but thinking about it from the perspective of National Security Council, from State, etc. In fact, I just came back from the Mekong region, I just came back from Vietnam, and from Myanmar, just last week. I was there a few days ago. So when we meet there, what's our interest generally is in a strong and sovereign Mekong region, right? That is how you want a prosperous sovereign Mekong region, that orients and depends upon itself, that in my mind, number one, emphasizes a free private market, right, which you have certain leaders, between especially Vietnam, Thailand, and others that can help influence the region. It also avoids our biggest concern, right? And, in my opinion, most of the time, so why do we have such a big concern on China or Russia or other places? The number one isn't, it's not an issue, you know, an anti-Chinese against the people, right? What it is, is its concern over one country, having a dominant or very significant influence on the domestic matters of another country, right? And in my mind, it's a form, you know, we we sort of tried that, or the Western nations tried, that it was called colonialism. It didn't work out very well, it didn't work out very well, for us, it didn't work out very well for those countries either. So it was a failure. And what we have concern about, in my opinion, is a form of kind of economic neo-colonialism. And I think that is the threat that Belt and Road represents, etc. It's not for charity, that China is doing it, you know, it's not, oh, suddenly, they're so into humanitarian causes. It has to do with significant influence over a country.

So, our biggest approach in Mekong, for example, is if we ensure their own prosperity and success and a strong private market, it leaves them a lot more insulated from others coming in, and approaching things with this form of neo-colonialism. So, that's a, I would say that's a recurring thing. Every region, I think, or every country has, you know, a different thematic approach. And, you know, I'll give you a few examples—I just came back from Indonesia. I think Indonesia, is a country where, if you look at where we are today, versus where we should be in a relationship, it's probably one of the biggest gaps. And that's not because we have bad relationships with Indonesia, we have good relationships with Indonesia. But why are we not the number one trade partner? Why are we not? Now, part of the reason for that has been, probably, geographic distance. Part of the reason for that is, it's just difficult to do business in Indonesia. And so our private market has a hard time doing business in Indonesia, right? And if you talk to the CEOs of our private market companies, that's what I hear, they'll say, oh my God, it's such a headache.

Now, one of the very important things that we work with Indonesia very closely on, is their Omnibus law, to make them, they're much more open to the private market that, again, that is a huge benefit for the United States broadly in our foreign policy, because a strong and empowered Indonesia, is a strong check to other competitors, but also really important for our bilateral relationship. So that's another example.

HOCHBERG:  So you mentioned the Mekong region, that's in terms of being prosperous as sort of a good bulwark against Chinese influence. Considering the immigration issues that we've been facing and the Trump administration's been strong on, is there a lot of work in Central America to, sort of, improve the economic conditions there, so less people may have a reason to want to migrate out of those countries?

BOEHLER:  Absolutely. I mean, I think that one of the things in my confirmation that I I told Congress, and I committed, was that I'd worked very closely with the ministration, to reopen El Salvador, Guatemala, and Honduras, to American investment. Because I think, Fred, what you said, and is 100 percent correct—which is the medium to long term, the real way to end an issue there is to ensure prosperity of our neighbors. And in fact, the individual that I hired, her name is Sabrina, to run Western Hemisphere for us. She had worked with DHS on a number of those agreements. And when she came to me, this is this is right, when I think, I just been confirmed, and we had a phone conversation, and she said, you know, I want my legacy—you know, we set up these agreements, which is great—but I want my legacy to be in the strength of making there no reason, over time, for folks to need to do that, and to make that trip. And, you know, right away, I thought, well, that's a phenomenal intent. And it was an easy hire for me to do that.

But no question, I think if you look at our strategy, it is so important to be so strong, and, in the Western Hemisphere, close to home. And I think it's so important to be strong, close to our competitors’ home, and so in the Indo-Pak area is another huge area for investment where we have a lot of friends. And, you know, look, the nice thing about the United States and from a foreign policy perspective is, we have great friends near home. You know, it's easy to take a pessimistic view to our relationships, but I always think to myself, would I ever trade places with China in terms of relationships? I know our relationships, they're fantastic in Western Hemisphere, with some exceptions, you know, Venezuela. I know our relationships in the right close to their home and Indo-Pak with Japan, and Korea, and Indonesia, and Vietnam, and Thailand and others. And I know their relationships. I I guess I like our team better than the, you know, Venezuela, North Korea, Iran team.

HOCHBERG:  I think they would prefer our team as well. (Laughs.) I've heard a senior Chinese official once remark to an American secretary, you have all the good allies.

BOEHLER:  No, you know, the way I, I think about it, like if you play War in cards, right? Like, truthfully, we have all four aces and we're pretty upset that we don't have all four kings—we only have three of them. And we'll work, and we'll get the other king, but we are sitting with four aces.

HOCHBERG:  So, can you help our members understand—when I was running EXIM, an Export-Import Bank, and Elizabeth Littlefield was then at OPIC—how many countries did you operate in? And I know there were a handful that were not too poor, that Export-Import Bank had operated in, and some of those countries are not that rich, that in those days OPIC it up. So, just so our members have a sense of what your geographic—is it thirty countries, fifty countries? Give them some idea.

BOEHLER:  Yeah, I think I think we're in over 150 countries right now. And so I'll give you a sense of, kind of, mandate from Congress and where we invest. So let me tell you, actually, the simple way to about it is where we don't invest. So we do not invest generally in high-income countries, right. So the expectation of Congress is that I'm not going and investing in you know, something in Japan, despite the fact that they're extremely close ally and friend, but we don't need the money, and we co-invest together, right. So that's a perfect example. So that is what I don't do, with two exceptions. So the two exceptions are investing in a high-income country if it directly benefited developing people or developing country. Okay, so in a direct way. And then the second is, Congress did ask us, in Europe and Eurasia, to look at investing for energy independence, and that is including high income countries. And as you may expect, that's somewhat a, you know, a response to Russia, on the energy side, but that was a bipartisan mandate. That happened after the BUILD act. Now, you know, about nine months ago, so that, that gives you a sense, everything else is fair game, including those tours of high income, what is not fair game, and what we do not do, are high income countries, except in those circumstances.

HOCHBERG:  Except, I understand now, you're also able to do the United States?

BOEHLER:  Ah, yes. Well, that a different—

HOCHBERG:  They're a pretty high-income country last I checked. (Laughs.)

BOEHLER:  That's an opinion, I guess. I'm only kidding.

HOCHBERG:  So, and it has gotten a little controversy. I know, when I ran the Export Bank, we were sometimes asked to do export-related domestic work, which we did not have the authority to do. And it can be very political. But can you talk about what—because I know it has to do with onshoring and so forth, which has its own complexity to it. So maybe you could explain that to our members.

BOEHLER:  Absolutely. So, and I'll tell you the authority too, because I think that's important. So, and we're looked at, so the genesis of the domestic authority, actually, was related to ventilators. And, you know, the story essentially, is, as we created and built out our ventilator stock, the reason we were able to do that so quickly, is because of the American manufacturing sector. Right. And, and that's a combination of the domestic ventilator manufacturers, as well as domestic manufacturers that shifted quickly, like Ford and GM on the car side. And so the thought process was, in the context of a pandemic like this, right, what if we didn't have that capability? And then by the way, what are other areas where we're weak? Because if we can't take some of the lessons learned to date and apply, then you know, whether it's related directly to the Coronavirus, or whether it's for another pandemic, then we've lost the opportunity to learn and adjust. And, so what happened was, the Department of Defense has the authority, through the Defense Production Act, through DPA, to invest domestically. But they lacked the experience. And that's not me saying it, or my own opinion, that was them, coming to us through interagency. So they said, listen—we would love to use this authority, but we're not a bank. We don't know how to do it. And so the reason why DFC was chosen—a couple reasons. One, at our heart, if you look at what we are, we're a bank. We're a development bank, but we're a bank. Our operations, we have credit committees, we have bankers, right, we look like a bank, which is very different than other agencies.

The second reason is actually because we have an international purview as well. And the reason I say that is, if you just look domestically, and let's take something—let me give some examples of things we've looked at. One of the very first things we looked at domestically is around generic pharmaceuticals, right? Because this is not made in the United States. So, and half is in China, if somebody wanted to turn us off, for whatever reason, pandemic related, etc. You know, there's a worry, we're susceptible. Those are 90 percent of the medications that we take every day. Let me give you another example, something that we were worried about in the pandemic—which is 90 percent of gloves produced today in the world are produced in Malaysia. That's where rubber, most rubber is. Now, again, we have a fine relationship with Malaysia. I don't think there would be anything, but what if there was a very bad outbreak in Malaysia that could shut down glove production? And I will tell you that would have a big impact on us—something we were worried about and a weak point. But when you think about using this authority, this DOD authority, you don't want to just think about it just domestically, right? Does it make sense to make 100 percent of gloves in the United States? Probably not. But perhaps some, and then have redundancy and other allied countries, who actually want to think about the problem in a holistic way. So the authority that was granted, it was actually, and the way to think of this a little bit, is almost like an outsource bank for the Department of Defense. I have a small team, about seven, eight people that focus there, that work very closely with DOD and also the interagency, HHS, etc. to evaluate this and it's a two year authority that is in response to the pandemic. So—

HOCHBERG:  Is it only in line with the Defense Production Act? Or it can be separate from that?

BOEHLER:  It's in line with DOD's authorities on defense production. So, just again, for those that are a bit more technical, I will tell you what was important to me in this and how we set it up. Number one, DFC is a new agency. My belief on DFC is, during something like Coronavirus, we are more important than ever. And so we have been very active. We have quarterly board meetings, our last board meeting, so June board meeting, was our biggest board meeting ever. Our last board meeting in September, we did as much volume and transactions as we did all of last year. And that is because the whole team has stepped up. Because we are very needed during this time. So first and foremost, I could not have it distract from our mission. The three things that I said—development, foreign policy, and returning money to the American taxpayer. Second, under DFC, I could not use, nor would I be comfortable using, any of our dollars—sixty billion dollars, how we operate, etc. because that's not our mandate from DFC from Congress. So the way we set it up, separate team, also separately funded from DOD authority, so all that money comes from that. So, just so you know, I was conscious of these things. Because otherwise, if you couldn't do it right, and I, look, this is an extraordinary time that we're in, and it calls for extraordinary measures. But there would be pitfalls. And there are pitfalls, if not, if we're not careful and thoughtful. So that's how we set that up.

HOCHBERG:  Right, it can look a lot like industrial policy if we're not—

BOEHLER:  Sure, absolutely. But I—

HOCHBERG:  We're about the time I'm going to open up to our members' questions. So I'm going to check with the CFR team and see if it's time for members to ask questions. And if you do, just raise your hand, and then they will call upon you unmute your microphone, they do not unmute your video, so you don't have to worry if your hair is a mess when you ask a question. None of us will see—not even Adam or I will see that. So Sam or Connor, tell me where we are.

STAFF:  Our first question will be from Aryeh Bourkoff. As a reminder, please state your affiliation.

Q:  Thank you. It's Aryeh Bourkoff. Close, but I appreciate it. CEO of LionTree. And thank you, Fred. And Adam, good to hear you in this capacity and very, very helpful. I have just one question, which really relates to, kind of, the marriage between capital and policy. And I want to use the example of the Abraham Accords, which is a massive accomplishment for the administration recently, and has, what I call, a slow burn to it. Unlike the twenty-four/seven news cycles where things are here today, gone tomorrow, this is building energy and building momentum as we go. But you've announced the Abraham Funds, which is, you know, corollary to it—could you describe how that came about and how you think about policy and capital, and really maybe go into a little more detail of what the funds are supposed to do in the region. Thank you.

BOEHLER:  Sure, thanks, Aryeh. So, let me start with something general and I'm gonna go onto the fund. So, one thing that I think is important when you think about DFC, and the focus on foreign policy as an instrument, is, if you think about the various forms of government apparatus focused on foreign policy, right, you have Department of Defense, national security, the national security apparatus, state from a diplomatic perspective. This is the money of the U.S. government. And so, when these things are combined, they can have a very strong outcome. And what's interesting to me is, the people that understand this the most, is DOD—are the defense folks, because if you're a soldier, you know what can be accomplished through the means you have. But you also know the limitations of those. And so they naturally understand extremely well, which is why we make great partners. And sorry, I'll get around your question, Aryeh, the, last week, one of the folks we met when I was in Qatar—we met with the Taliban, it was my second meeting with the Taliban—and my point to the Taliban, and this has been our point, which is essentially, you've met the diplomatic might of the U.S. government, you've met the intelligence agencies, you've certainly met the military. Now you're meeting the money. And you make, you know, Taliban makes 200–250 million dollars of revenue a year—we spend 40–50 billion a year on war. There is the potential, or at least they should understand the potential, if there is eventual peace, and if Zal is able to take it down that road, to become a real organization and play with the big boys, because Afghanistan can be a great country. And their main point after the first discussion, and then we emphasize this, is nobody, in the twenty-one years that the United States had been here, or sorry, the eighteen years the United States had been here. No one has had a conversation like this with us on the economic side. So it made it really interesting. So the marrying of those is very important.

Getting around your question on the Abraham funding—the Abraham Accords—this is the marrying of U.S. policy, with the financial also, and you know, one of the great things, I think, about the profound change in the Middle East, is you have countries that decided no longer to have anybody veto their foreign policy. They weren't going to wait, they weren't going to let their foreign policy be vetoed by anybody. And so you saw UAE, Bahrain, and now Sudan, move forward because it made sense for them. And the fund is really established to focus on the resilience in the region. And that's going to include anybody in the Abraham, the court is automatically could be a beneficiary. But then it's also going to include broader in that region for investment. So more and more, what you'll see is DFC and others married on the diplomatic side. And again, I'll make the comment. At the end of the day. This isn't just foreign policy, it is important foreign policy, but from the development perspective, what you're doing is you're building resilience for the people. That drives better foreign policy and stability. So the two are all connected. So I think you'll see a lot with the Abraham Fund. And the mandate is the Middle East, but broader North Africa as well. And we'll be very active with anybody that signs up to the court, but then beyond.

STAFF:  Our next question is from Patricia Wu.

Q:  Hi, Adam, thank you so much for doing this. And I also want to thank your team, Roxanne and Dea Martin, we just had a terrific conversation with them. I'm curious, given your unique background in health, as an entrepreneur, and also with the centers for Medicaid. I'd be curious, as you talked about those three areas that the DFC looks at, as you look at, as you look at developing countries in Latin America and in other parts of the world, where do you see is the sweet spot for DFC when it comes to health? Um, and if you could comment a little bit on, you know, the continuum as it relates to you know, maybe more bricks and mortar types investments, you know, clinics, that type of thing, or maybe more of the kind of the non-bricks and mortar pieces—so whether that is FinTech, to encourage more private sector, kind of, financial coverage for health—if you could comment a little bit about, you know, where you see the sweet spot. Maybe, it was interesting to hear you mention just the the rapid uptick in investments, maybe there's some existing ones that you can talk about, or ones that you think are areas that should be explored.

HOCHBERG:  I'm going to suggest just a quick thing—let's try and keep questions briefer, so Adam can answer more questions to get more people in. So Adam, take it away.

BOEHLER:  So, there are two areas that we started focus groups on since I joined—number, first was healthcare. So we introduced a six billion dollar call for investments on the healthcare side. And then technology—I think, all too often, we introduce technology because all too often, folks have thought about development in more traditional sense, right—roads, bridges, etc. which is fine, we do that too. But I think technology—my goal is to have over half of our investments be directly related to technology in the very near term, given how much it drives development going forward, you know, when you think about women's empowerment, think about coding schools, etc.—what we do there.

On the healthcare side, I think that, whether it's Western Hemisphere, whether it's Sub-Saharan Africa, others, there is the opportunity to skip a step. And what I mean by that is, if you look at mobile phone usage in Africa, they were not tethered to fixed line. And so they move very quickly with cell phones. Same thing here, you look at the buildup of fixed infrastructure in the United States and the developed world in the seventies and early eighties, which was very health system dependent, and now that weighs our system down. I think there is the ability to think more thoughtfully about home-based medicine, digital medicine, telemedicine—doesn't mean you don't need facilities or clinics, but I do think you can be more thoughtful and, sort of, learn from the lessons of where we went wrong in certain areas and not make those mistakes. So, I think our most interesting investments are those where they are somewhat facility-based, but are reaching out to home or telemedicine technology also, so that we're kind of blending the technology and healthcare side.

STAFF:  Excellent. Our next question is from Ramon Escobar.

Q:  Hi, thanks, Adam, so much for for speaking with us. We met briefly, you came through Mexico City, I was your host in Mexico City at the embassy there. I'm now a fellow with the CFR looking at the role of private investment in advancing our migration policy. So really glad that you guys were able to even talk about that already. My question is much more specific, however, it's, you know, how do you see the DFC catalyzing private capital to invest in smaller tickets with less established project sponsors, which is really what we need in the northern triangle in particular, to really address our underlying migratory concern. Thank you.

BOEHLER:  It's a great question. And you know, my belief, right? So when we look at and analyze development opportunity, to me, we've got to get away from is, you know, just big ticket items, right? Because at the end of the day, the question is the impact, and sometimes you can make just as much of an impact on a 500,000 thousand dollar check as you make on a 500 million dollar check. And so the key is, what is the impact you're having? We've been pretty active on the small and medium, and women on the business side, particularly during the pandemic, so part of our view, so the interesting question is, during a situation like this, and a pandemic, how do we get dollars out quickly? Because we're a bank, right? So deals come. It's not the kind of thing where you pivot, and you write a check for 500 million dollars in a month, right? That's just not that's not how it works. And so, but we have this, clearly, there's an interruption of business, and how do we make a difference.

So what we have done is, we've created almost what I would consider virtual PPP programs, where we've worked with banks in region. And we've done this in Central America, a lot in Western Hemisphere, in Africa, where we've used them as conduits to get liquidities to small and medium businesses. So that's been huge in the context of the pandemic—to get liquidity out there, because a lot of people can't do a program like PPP, like what we did. And then I think those relationships are critical to making a difference on the small, medium, business side.

The other thing too, is, we invest in private investment funds sometimes too. And we don't invest in private investment funds, because we want to be a fund of funds, etc. We do that because, to me, it's a way you get feed out on the street, so that you're looking for critical entrepreneurs that you can invest dollars in. And so we've done a lot of partnerships to identify and then fund, whether that's through investment funds, whether that's through micro-finance, etc., to try to get those dollars out to make an impact.

STAFF:  Our next question is from Hank Cohen.

Q:  Hello there, thanks for the presentation. I'm a retired Foreign Service officer who specialized in Africa. And my question is, do you consider investing in extractive industries? Now, the reason I ask is that Africa has virtually all of the lithium in the world, which is vital now for the storage of power for electric cars, and for storage of energy from renewable, solar, and that sort of thing. So mining lithium in Africa is vital. Would you consider financing that?

BOEHLER:  Yeah. (Laughs.) Yeah, I mean, look at the end of the day, you know, and I used Afghanistan as an example, I mean, one of the points I made to the Taliban is, on the lithium side, I mean, there are mines in Afghanistan with, you know, tens of billions of dollars of lithium in them. And the reason why one can't look at that, or, you know, the other minerals they have, is generally because of security. And guess what, the security issue is them. And so in a situation, by the way, I think this will be so important, and sorry, to pivot to Afghanistan, but the same is gonna hold true on Africa in this area, is, if you think about a situation where there is an agreement reached with the Taliban and with the Afghan government—well, that's a moment in time and as you know, there will be a lot of people that don't want that to succeed, even after it's signed. So the biggest way to scuttle that is to kill people and create a lot of ruckus on an ongoing basis, to try to break it, to exploit what could be a new and fragile agreement. The best way to stop that is by giving people medium–long term economic interests, so that people have the economic interest to stick with it. Because at the end of the day, a lot of times behind conflict, behind war, is money. In fact, it almost always is. And so to the extent you can countervail those incentives, then you can avoid some of those things. So anyway, that was a, sorry, got on the Afghanistan thing.

But in Africa, as well, I think the rare earth side, for us, is critical from a foreign policy perspective. And it can also help empower development. Now, in everything we look at, we consider the impact on the human side of things, on human capital, and we consider the impact on the environment. So that would need to be rigorously, rigorously understood and studied. Because that that's our mandate. And that's our requirements given to us by Congress. So it has to be done in a responsible way. And I think one of the benefits of the United States is, we have not bust in thousands of people, but we have tried to empower the local population in everything we do, and do it in a thoughtful way. So that's the only, you know, corollary I'd put on to that.

Q: And did you say—is your lending cap sixty billion, or your annual lend amount sixty billion?

BOEHLER: Our lending cap is sixty billion. Annual amount varies over time.

HOCHBERG:  Okay, Sam, back to you.

STAFF:  Our next question is from Witney Schneidman.

Q:  Hi, this is Witney Schneidman. I'm with Covington & Burling. Fred, good to see you. I'm former— Um, Adam, I was in Ethiopia, just before the shutdown in February, and everybody was talking about the DFC's commitment to invest 5 billion dollars in Ethiopia. And when I sort of asked, folks, how's that going to happen? It was really hard to come up with answers. And I'm just, I'm interested in your reaction to that. Given that, I think our FDI stock there is about 600 million dollars, and I would love to see the U.S. investing five billion dollars in Ethiopia and other countries. But I get concerned about overpromising and under-delivering, and sort of not being clear about timeframes of delivery. So just would love your comments about, you know, your roadmap for investing five billion dollars in Ethiopia. Thanks.

HOCHBERG:  Good to hear from you.

BOEHLER:  Sure. So, I'm just going to, I'm going to put it on the side for this, kind of the administration's concern, which is a very real concern on the issue, you know, the DAM issue with Egypt, so I'm not going to comment on that specifically, because, but I'll comment on on your specific question, which is, in that case, is a perfect example of a number of things that I think are really important and I want to lay out.

Number one is perfect example of collaboration among DFIs. That is something that I worked on with IFC very closely at a CEO level—it's a perfect example of using the money of the U.S. government to make a a difference from a policy perspective. So when we talk to Abiy our main point—so, you mentioned the stock of FDI in Ethiopia—so why is it not higher? And I, Felipe and I, spent time and we said well, the reason it's not higher—there's a bunch of reasons—but consistent reasons that come up, are your ability to take capital out, and currency issues. And so, they constantly hold up things, and you know, when, as you may know, when you worked in U.S. government, you normally get is, you get like a series of talking points before your meeting. So they'll be like, oh, you're meeting with Abiy, okay, here's your here's your talking points. And you'll say, oh, it'll be—we would really like you, you know, to not be corrupt. And we'd really like you to, you know, open up to foreign direct investment and follow rule of law and transparency. Like that's like literally what it looks like every time. And I'm always like, what the hell does that mean? You know, they're really nice, general things to say. But like, what does that mean? And in this case, too, I just gave you two examples. But the problem is, if you don't allow offshore accounts, and your fear essentially, is, if you do that money will flee your country.

Number one, if you just do it all at once, honestly, money may flee your country, I can't, I'm not sure it won't. And number two, if you don't allow them now, how do you know how to do it? So I can write them a letter, and I can say all these things, but they need specific help in how to do it, and they want that, right? That's when, and our Treasury has phenomenal resources in doing it. So, what we did is we said, this is the reason it's not coming in. And so I said to Abiy, I said, listen, you run Ethiopia, I don't run Ethiopia, I'm not going to tell you how to run your country. But, I can tell you that this is the limitation. And I can tell you that if you make these changes, specifically, not at a high level some talking points, then we can invest a lot more money. And that's where the five billion dollars came from. And what they said was, they said, you know what, we'll do it. We'll do it in two industries, we care about to start, so that you don't open up the entire country. And we'll do it in technology. And we'll do it with technology and energy. We'll do it in technology and energy in these sectors and these criteria, so that it's gated, so that—and we help them do it, it was with Treasury, with USAID. And then the five million dollars was over a period of time and contingent on that.

And so I felt comfortable we could put that capital to work and the LOI that eventually, hopefully, if they resolve where they are in the DAM—that we will sign and that we will move forward on—at that point, once they reach resolve, it will be very specific and timely on how we'd approach it. But again, I think it's the perfect example of talking at a head of state level, and using those dollars and being thoughtful about what kind of specific changes can be made that benefit that country and that benefit private business. And so, that's how we approach it in Ethiopia.

STAFF:  Our next question is from Ryan Kaminski.

Q:  Thank you so much, Adam and Fred. Ryan Kaminski from the World Benchmarking Alliance. And can you speak a little bit to the extent that IDF sees efforts to align its work with the UN Sustainable Development Goals? I ask because we're seeing the private sector, including business and investor voices in the U.S., increasingly embedded on the urgency for sustainable finance and investing. But also because the SDGs are a framework that speaks to the foreign policy element you mentioned so succinctly, because every country in the world has agreed to them, and it's also an agenda that the U.S. helped shape. It's also really helpful for the enabling environments for business and investing that you spoke to earlier. Thank you so much.

BOEHLER:  Sure. I think, you know, one of the things that we have is called the blue dot network, which I think a lot of the goals are very similar to the SDGs. A lot of the goals that are set for us, from a DFC perspective, are very similar to the SDGs. I think that the U.S. policy has generally just been a little bit concerned about outsourcing foreign policy to a multilateral agency. But I think, in terms of tone and tenor, there's a lot of similarities. And so, you know, we tend to encourage a lot of the same things. I think, I think it's just more of—I would say there's a little bit of nuance there, in terms of ensuring that you're emphasizing very similar things, while still maintaining some level of control over foreign policy and not kind of outsourcing it to a multilateral.

STAFF:  Our next question is from Trevor Kincaid.

Q:  Yeah. Hi, Adam. Thanks so much. Trevor Kincaid with the World Bank Group. Just a question on where you see collaboration opportunities between IFC and DFC. I know there's been a lot of talk about that in U.S. leadership and multilateral organizations around the world. And so I'm just wondering where you see those opportunities.

BOEHLER:  Yeah, thanks. I actually think I think they're—

HOCHBERG:  Maybe you could just quickly tell people what the IFC is—just in case we have a few members who are not—with all the acronyms.

BOEHLER: Yeah, IFC is the World Bank's Development Finance Institution. And I, when I was referencing Felipe, who is, just left, or is—he left, right? Trying to think whether—I know that he's leaving, I think he just left, but I really enjoyed working with Felipe and I brought him up on the Ethiopia side because we collaborated. I think there is a lot of opportunity for collaboration and one of the, one of my beliefs is, and one of the strengths of, strengths the United States is, our, what we bring from a partnership perspective and our allies.

And so what I've been clear with IFC, with IBD, with JBIC and Japan, my counterparts—these are all close African development—these are all close relationships, where we have signed partnership agreements, but my belief on this is, there's no need to compete on deals. Again, at the end of the day, my goal is overall impact. If I have a 200 million dollar check, and instead I write 100 million dollar check, and IFC writes 100 million dollar check, and we can do it together, that's exceptional. And that really makes sense. So I think there's the right balance, right? You don't want to, sometimes, if you're always multilateral, things can take a million years, because you're always waiting for everybody to hold hands.

There's a very different, you know, there's one side that's that, there's another side where you say, oh, we don't partner at all and, you know, we're just doing things 100 percent unilateral. There's a balance where you would rather do things together, and you are open, and you want to do things in partnership, and you have, and if people can meet on the same timeline and do things together, you do that. And I really have found IFC to be a fantastic partner. I also want to recognize the strengths and weaknesses of the DFC. We have some great friends for the United States. We have a great interagency. We have all of our embassies, we have USAID out there. One of our weaknesses is, DFC does not have a lot of field folks out there. I mean, IFC, the size of their new Ethiopia office, as I saw it built is, about the size of all of the people at DFC, just to give you give you a sense, right. And so, leveraging partners that are out there, local in the mix, in addition to our embassies, etc., and our mission offices that are there, are very important to leverage partnerships like that. And I think that's where IFC excels, and others too, like IBD, which is, IBD is the Western Hemisphere, the Latin American multilateral bank.

HOCHBERG:  We have three minutes. So we have time for a quick question and a succinct, quick answer, because we have to end at four. Sam?

STAFF:  Our last question will be from Andy Lehren.

Q:  Hi, thank you for your, for your time this afternoon. My name is Andy Lehren. I'm with NBC News. And I was wondering if you could further enumerate some of the deals since the Kodak deal of the DFC, with the DOD, and explain those objectives of those deals and where you're headed with this new endeavor?

BOEHLER:  Sure, Andy, you've got a huge pipeline. Oh—

HOCHBERG:  No, in two minutes. Go right ahead.

BOEHLER:  Yeah, Fred, or sorry, Andy, we have a huge pipeline of deals. I think you'll see some announcements in the coming couple weeks. But you will see a lot focused on things like vaccines on the healthcare side. So, things related to resiliency that have gone through our whole interagency. So stay tuned on that. But I think you'll see some pretty big action in the next few weeks.

HOCHBERG:  Okay, well, I'm just going to, at 3:59—we have a, we like to start and stop exactly on time at the Council on Foreign Relations. So I hope all of our members will join me in thanking Adam Boehler for an informative and fast paced conversation and some real insight into how the Development Finance Corporation works, and how it's succeeded after OPIC. So congratulations, and thank you for joining us, and thank you for your honesty and candor today.

BOEHLER:  Thank you for having me, Fred. I appreciate it.