US Investment Group Pulls Money Into S. Africa
WINDING up a 10-day visit to South Africa, the Washington-based Overseas Private Investment Corporation (OPIC) has signed three agreements that will inject more than $100 million into the country's economy and promote black economic empowerment.
South Africa is one of several countries earmarked by the Clinton administration as a priority area for United States trade and investment. OPIC announced that the Africa Growth Fund, a $75 million equity-investment fund managed by Equator Bank, would be extended to southern Africa.
The new fund, called Africa Growth Fund II, is expected to lead to substantial investment in the country's equity markets, which have experienced an upsurge since President Clinton lifted remaining US sanctions against South Africa last November.
The main criteria for equity investments will be the targeted project's potential for helping to uplift economically disadvantaged communities.
Richard Morningstar, senior vice president of OPIC, said the organization had held talks with South African lending institutions and banks with a view to securing increased access to loan capital for black entrepreneurs. Talks are also under way to establish joint ventures between South African commercial banks and US partners.
OPIC also announced plans to support a US-South African partnership to open more than 100 laundromats in black townships, and a joint venture between a South African black-owned business and the California-based minority-owned CADscan to create markets for computer-based training and computerized accounting.
``OPIC will do all it can to support the new South Africa in its transition to a multiparty, nonracial democracy,'' OPIC President Ruth Harkin said on the eve of the group's departure from South Africa.
OPIC, which provides risk insurance for US companies investing abroad, signed a bilateral agreement with South Africa last November during a visit by a delegation of about 25 US business executives led by Commerce Secretary Ron Brown.