Not yet operational, the IDFC represents a potentially major overhaul of U.S. development finance efforts. The IDFC's enabling legislation is the Better Utilization of Investments Leading to Development Act of 2018 (BUILD Act), which was enacted on October 5, 2018, as Division F of a law to reauthorize the (unrelated) Federal Aviation Administration (FAA) ( H.R. 302 / P.L. 115-254 ). Under the BUILD Act, the IDFC is to consolidate and expand the U.S. government's existing development finance functions—currently conducted primarily by the Overseas Private Investment Corporation (OPIC) and the U.S. Agency for International Development (USAID). In addition, the IDFC would have the authority to conduct feasibility studies on proposed investment projects (with cost sharing) and provide technical assistance. DFIs vary in their specific objectives, management structures, authorities, and activities. While it does not mention China by name, the BUILD Act alludes to concerns with state-directed investments, such as China's Belt and Road Initiative (BRI), which launched in 2013. Others, however, argued that the act could have tightened the IDFC's focus with respect to China, for instance, by requiring the IDFC to have a specific focus on countering China's investment and economic influence; from this perspective, the failure to narrow the IDFC's scope makes it likely that the new entity may support projects of limited U.S. foreign policy and strategic interest—a concern that some critics have levied against OPIC. Although the President's FY2018 budget request called for eliminating OPIC's funding as part of its critical view of U.S. government agencies with international development orientations, the Administration ultimately pursued development finance reform through OPIC as an opportunity to respond to China's growing economic influence in developing countries. What was the policy debate over the BUILD Act? Unlike OPIC, which is overseen by the USAID Inspector General, the IDFC is to have its own Inspector General (IG) (§1414) to conduct reviews, investigations, and inspections of its operations and activities. Equity Investments. This is more than double OPIC's current exposure limit—$29 billion. In recent years, OPIC support has reached record highs—totaling $23.2 billion in FY2017. While the IDFC's exposure cap is small compared to the potentially trillions of dollars that China is pouring into development efforts like the BRI, supporters argue that the IDFC could catalyze other private investment to developing countries through the U.S. development finance model. Implementation

		How and when is the IDFC expected to become operational? The BUILD Act requires the President to submit to Congress within 120 days of enactment a reorganization plan that details the transfer of agencies, personnel, assets, and obligations to the IDFC. Issues for the 116th Congress

The 116 th Congress will have responsibility for overseeing the implementation of the BUILD Act, including review of the reorganization plan, the transition it prescribes, and impact on U.S. foreign policy objectives. How can the IDFC best balance its mission to support U.S. businesses in competing for overseas investment opportunities with its development mandate? Does the current statutory framework enable the IDFC to respond effectively to U.S. strategic concerns, particularly with regard to China's BRI? Should Congress press the Administration to pursue international rules on development finance? Reorganization of U.S. Government Development and/or Finance Functions
Members of Congress and Administrations have periodically considered reorganizing the federal government's trade and development functions to advance various U.S. policy objectives. The Better Utilization of Investments Leading to Development Act of 2018 (BUILD Act), which was signed into law on October 5, 2018 (P.L. 115-254), represents a potentially major overhaul of U.S. development finance efforts. It establishes a new agency—the U.S. International Development Finance Corporation (IDFC)—by consolidating and expanding existing U.S. government development finance functions, which are conducted primarily by the Overseas Private Investment Corporation (OPIC) and some components of the U.S. Agency for International Development (USAID).
While the IDFC is expected to carry over OPIC's authorities and many of its policies, there are some key distinctions. For example, in comparison to OPIC, the new IDFC, by statute, is to have the following:
More "tools" to provide investment support (e.g., authority to make limited equity investments and provide technical assistance). More capacity (a $60 billion exposure cap compared to OPIC's $29 billion exposure cap). A longer authorization period (seven years compared to OPIC's year-to-year authorization through appropriations legislation in recent years). More specific oversight and risk management (including its own Inspector General [IG], compared to OPIC, which is under the USAID IG's jurisdiction).
A key policy rationale for the BUILD Act was to respond to China's Belt and Road Initiative (BRI) and China's growing economic influence in developing countries. In this regard, the IDFC aims to advance U.S. influence in developing countries by incentivizing private investment as an alternative to a state-directed investment model. The BUILD Act also aims to increase the effectiveness and efficiency of U.S. government development finance functions, as well as to achieve greater cost savings through consolidation.
The BUILD Act requires the Administration to submit to Congress a reorganization plan within 120 days of enactment of the act, and the IDFC is not permitted to become operational any sooner than 90 days after the President has transmitted the reorganization plan.
The 116th Congress will have responsibility for overseeing the Administration's implementation of the BUILD Act. As the IDFC is operationalized, Members of Congress may examine whether the current statutory framework allows the IDFC to balance both its mandates to support U.S. businesses in competing for overseas investment opportunities and to support development, as well as whether it enables the IDFC to respond effectively to strategic concerns especially vis-à-vis China. Congress also may consider whether to press the Administration to pursue international rules on development finance comparable to those that govern export credit financing. More broadly, the IDFC's establishment could renew legislative debate over the economic and policy benefits and costs of U.S. government activity to support private investment, and whether such activity is an effective way to promote broad U.S. foreign policy objectives.