Virtual Press Briefing with Caroline Vik, Chief Policy Officer of the U.S. International Development Finance Corporation (DFC)

MODERATOR: Greetings from the U.S. Department of State's Asia Pacific Media Hub. I'm Tim Johnson, and it's my pleasure to welcome journalists to today's on-the-record briefing. Today, we're honored to be joined by Caroline Vik, chief policy officer of the U.S. International Development Finance Corporation, known as DFC.

With that, let's get started. Chief Policy Officer Vik, I'll turn it over to you for your opening remarks.

CHIEF POLICY OFFICER VIK: Thank you, and thank you, everybody, for joining us. My name is Caroline Vik and I'm the chief policy officer of the United States International Development Finance Corporation, more commonly known as the DFC. I'm excited to be on the call today to share some details about the DFC, our mission, and our recent trip through Southeast Asia where we visited the Philippines, Vietnam, Cambodia, Laos, Malaysia, and Indonesia.

To start, just the DFC is the international strategic investment arm of the U.S. Government. So we work with the private sector to advance U.S. diplomatic and economic interests and drive economic growth for our allies and partners. We have $205 billion to deploy around the world. We do debt, equity, political risk insurance, loan guarantees, and project development funds that are used for early - the early stage of projects for feasibility studies and similar early-stage work.

Think of us as having sort of three core objectives. The first is to build diversified supply chains for critical materials. So critical minerals, pharmaceuticals, agricultural inputs like fertilizers, supply chain - I mean fertilizer, crop protection, vitamins and amino acids - and a range of other high-priority supply chains, to include semiconductors, batteries, magnets, and the like. The second objective is to strengthen strategic sectors - energy, advanced manufacturing, AI, fintech and financial services. And the third is to build critical infrastructure in high-priority locations - so ports, airports, strategic corridors, and everything under the digital infrastructure bucket from telecom, terrestrial fiber, subsea cables, and data centers. So our seven priority sectors fall out of those objectives: energy, critical minerals, transport infrastructure, digital infrastructure, financial services, health care, and agriculture.

We went to Southeast Asia for business development purposes. So we're trying to actively build our pipeline to do a lot more investing in the region. So we went and met with government leadership, all the relevant ministers, as well as some of the key companies in our priority sectors in the private sector to talk about what the priorities are, what the opportunities were, and hopefully find some deals that we could execute over the next couple of years to really increase our presence in the region. Our goal is to be the region's best partner and first call so that if there are high-priority projects that governments want to do, we want to hear about them and we want to try to support wherever possible.

I thought I'd start by running through sort of at a very high level some of the meetings we did, and then happy to take more questions.

So in the Philippines, we heard about the government's priorities from various stakeholders, including Maharlika, the National Security Council, and the Bases Conversion and Development Authority, with a focus on major infrastructure and energy projects. We also had several roundtables with private sector companies where we talked about minerals processing, subsea cables, energy, grid modernization, and other infrastructure updates from strategic corridors, bridges, ports, and airports. The DFC is also very excited to work closely with our interagency partners on other major initiatives, such as Pax Silica and the Luzon Economic Corridor, which we heard a lot of enthusiasm about in the Philippines.

In Vietnam, we were really excited to hear about the country's focus on critical supply chains, particularly for critical minerals and semiconductors. We also spoke a lot about high-priority energy projects to modernize the grid and bring more energy online to drive down the cost of energy. We also had very productive and interesting meetings with major telecom companies to discuss how we could help build out their networks with trusted vendors.

In Cambodia, we met with the Council for the Development of Cambodia and the Ministry of Mines and Energy, who walked us through their very ambitious and exciting national infrastructure plans, with a focus on ports and maritime connectivity as well as power generation and regional connectivity. In private sector meetings, we discussed infrastructure opportunities, including gas, other energy sources, mobile networks, terrestrial fiber, and data centers. I was also honored to attend a signing ceremony on behalf of our CEO, Ben Black, for DFC's financing of Phnom Penh's brand-new international airport. For those of you who haven't seen it, I have to say it is one of the most beautiful airports I've ever seen, and the DFC is very proud to support Cambodia on this important project.

In Laos, we were received by a wide range of key government offices, including the central bank, the Ministry of Industry and Commerce, the Ministry of Public Works and Transportation, and the Ministry of Finance, who told us about Laos's ambitious plans to build out their infrastructure strategy and enhanced regional connectivity, to include new rail lines and expressways, as well as important initiatives to address seasonal variance in power generation and electricity export. Our private sector meetings raised a bunch of fascinating and interesting opportunities in energy mining and transportation as well.

In Malaysia, we met with a broad group of the Malaysian government, including the National Security Council, the Office of Economic Advisors, the Ministries of Finance and Foreign Affairs, the Ministry of Investment, Trade, and Industry, Transport and Natural Resources, as well as the Malaysian Investment Development Authority. The interagency group shared a range of national investment priorities, including semiconductors, critical minerals processing, energy security and agricultural security. We also met with a range of private sector companies, to include major telecom operators, where we talked about the ongoing privatization of the national 5G grid and opportunities to help build out - build out those networks with trusted vendors.

Last but not least, in Indonesia we heard about the government's major focus on promoting energy security through upstream exploration and midstream energy storage and transportation infrastructure, as well as new ports construction and an initiative to support critical minerals mining and processing in the country. Our private sector meetings also shared interesting opportunities in nuclear energy and financial services.

With that, thank you once again for joining me this morning, and I'll turn it back over for questions.

MODERATOR: All right, thank you so much. We'll now turn to the Q&A portion of today's briefing.

Our first question goes to Beatriz Cruz of BusinessWorld in the Philippines, who submitted a question in advance. I think she's on the line, if you would like to unmute yourself and go ahead.

QUESTION: Good morning. My question is just - it was mentioned earlier, the interest for Luzon Economic Corridor and Pax Silica. Are there investments that you're looking to put into these projects? And just curious if the Philippines reaching upper-middle income status, how will this affect the type of investments that - the type of financing that the DFC will put into the Philippines? Thank you.

CHIEF POLICY OFFICER VIK: Sure. So yes, both initiatives will involve a range of opportunities, investment opportunities. In terms of the Luzon Corridor, I think we've identified a bunch of potential projects for financing, and are looking - are looking for more. So there's, there's a sort of wide range.

In terms of Pax Silica, we're working closely with our State Department colleagues to support. When the time is ready, the DFC stands ready to help the State Department advance the Pax Silica economic zone.

MODERATOR: Thanks. Staying with the Philippines, let's go to Bless Ogerio of BusinessMirror in the Philippines, if you could unmute yourself and go ahead.

QUESTION: Good morning, everyone. My question is: Did your meetings in Manila identify any specific investment opportunities or projects that DFC is now looking to pursue in the country? And my second question is: The Philippines has been promoting projects such as, as mentioned earlier, the Pax Silica to strengthen our critical mineral supply chains. So how does DFC view opportunities like this, and what will it take for more projects of this kind for the Philippines to attract international investments? Thank you.

CHIEF POLICY OFFICER VIK: Yes, we talked about - both with the government ministers as well as our private sector meetings, talked about a range of projects, from transport infrastructure projects - ports, rail, airports - to potential mining projects, as well as a lot of discussion about both energy generation and grid modernization projects.

MODERATOR: Thanks. Let's go to Jaden Christian of BFM in Malaysia, if you could please unmute yourself and go ahead.

QUESTION: Hello. So you have previously said that DFC has a number of partnerships and opportunities in the works for Malaysia. So without naming any specific companies, can you share how advanced those discussions are, and whether Malaysians can expect the first DFC-backed investment to be announced within the next 12 months?

CHIEF POLICY OFFICER VIK: I would say in many cases, we're at early stages of identifying what the priority projects are. I think this trip really jumpstarted our pipeline, and we've come back with many, many leads that we'll need to continue to develop. But our intention is to quickly build our pipeline so that we have a wide range of projects across our priority sectors that we can execute on in the next two years. So yes, I hope we will have things to announce in the next 12 months, but certainly over the next two years we will be moving forward with hopefully a number of projects in Malaysia.

MODERATOR: Thanks. Our next question goes to Evelyn Cheng of CNBC, if you could please unmute yourself and go ahead.

QUESTION: Hi, can you hear me?

MODERATOR: Yes.

QUESTION: Great. Thanks so much. I have two questions. One is, could you share some details on any significant steps taken to secure U.S. access to critical minerals? And then two, in terms of the AI race, Chinese AI models and infrastructure are often increasingly considered far lower cost compared to the U.S. ones. So, wondering what's the level of concern at DFC and are there plans to invest or encourage use of American AI in the region? Thank you.

CHIEF POLICY OFFICER VIK: Sure. Yeah, building more diversified supply chains for critical minerals - from pit to port to processing to product - is one of our top goals. And frankly, every government that we engage with in the region shared those goals. I think we see a lot of emphasis from countries that want to move up the value chain and want to build out their midstream capabilities so that they can process their own minerals, and this is something that we're interested in helping them build up that capability.

In terms of AI, we are seeing enormous demand for American AI and stand ready to help finance projects where needed. And in addition, we're seeing a lot of demand for trusted vendors across the digital infrastructure space, which we're very excited to support.

MODERATOR: Thanks. Our next question goes to Irma Isip of Context in the Philippines, if you could please unmute yourself and go ahead.

QUESTION: My question is: Is there a specific amount out of the portfolio of DFC that can be allotted both for government and private sector projects? Thank you.

CHIEF POLICY OFFICER VIK: I'm sorry, do you mind repeating yourself? I couldn't hear you very clearly.

QUESTION: I'm sorry. My question is: Is there a specific amount of cost that can be allotted to the Philippines for - both for government and private sector projects?

CHIEF POLICY OFFICER VIK: Two comments. One, while we work very closely with governments to understand their priorities and focus where sort of their priorities intersect with our priorities, our investments are always with private sector entities. So we don't lend directly to governments. We can work with state-owned enterprises as well, but we primarily work with private sector companies to actually execute on our shared investment priorities.

In terms of specific numbers, we don't have any sort of quota or cap, so it's really just about finding projects that are strategically aligned with our priority sectors, that are projects that the Philippine government is interested in us investing in, that are commercially viable. So the DFC only makes sort of commercially viable investments in the private sector. So provided we can find bankable deals that align with both of our governments' priorities, there's no cap to how much we can invest. And it's a high priority for us to engage very heavily, so we're building out a strong pipeline.

MODERATOR: Thanks. Our next question goes to Niem Chheng from The Phnom Penh Post, if you could unmute yourself and go ahead.

QUESTION: Thank you. I have one question, because I - you said you have met with the CDC head and also with the energy minister, so I'm asking if there is any, like, potential cooperation or investment between the U.S. and Cambodia. Thank you.

CHIEF POLICY OFFICER VIK: Absolutely. We had excellent, highly productive meetings with the Cambodian government. We're really excited to deepen the partnership on investment. They proposed a number of very interesting opportunities that are well aligned with ours, and so we look forward to working hand in hand with them to advance these projects. I would say similarly, our private sector meetings in Cambodia were very interesting; lots of great projects in terms of sort of logistics, expressways, and other projects that we look forward to advancing.

MODERATOR: Thanks. Let's go to Samantha Beltran of the South China Morning Post, if you could please unmute yourself and go ahead.

QUESTION: Hi, can you hear me?

MODERATOR: Yes.

QUESTION: Okay, great, thank you. So I have two questions. So first, with the DFC's visit across Southeast Asia largely to do with critical minerals, how highly does this rank up the DFC's priorities, and what were the most promising opportunities identified in the region during this trip? And my second question is: The Pax Silica framework in the Philippines is reportedly being finalized this year. Are there any investments that the DFC has pledged in particular for this? I can also send the question in the chat box, just so you have something to refer to. Thank you.

CHIEF POLICY OFFICER VIK: I would say yes, building diversified supply chains for critical minerals is a priority, but it's not our overwhelming priority. So we have lots of priorities across our seven priority sectors. These include critical minerals, pharmaceuticals and other health care projects, energy, food and agriculture, transport infrastructure, digital infrastructure, and financial services. So I would just consider critical minerals, while certainly an important priority, it is not our only priority or even overwhelmingly our area of focus. So we're looking at lots of critical minerals projects, from upstream to midstream to downstream, as well as associated infrastructure, but we are also looking at lots of projects across all of our other priority sectors.

In terms of Pax Silica, I don't have any details to share today but I look forward to sharing more in the future.

MODERATOR: Thanks. Let's go to Logan Zapanta of the Philippine Daily Inquirer, if you could please unmute yourself and go ahead.

QUESTION: Hi, good morning. So regarding the support for Pax Silica, I'm just curious: Will you prioritize financing projects by U.S. company locators, or are you open to supporting as well locators from other countries? And my second question is: Are there specific investment sectors that you discussed with Maharlika, the Philippines sovereign wealth fund? Thank you.

CHIEF POLICY OFFICER VIK: In terms of Maharlika, we talked about projects across all of our priority sectors, but with a strong focus on energy and energy generation and grid modernization.

In terms of Pax Silica, we'll have more details to share in the future.

MODERATOR: All right, thanks. All right. Well, I think we'll pause here then and I'll turn it back to Chief Policy Office Vik. If you have any closing remarks, the floor is yours.

CHIEF POLICY OFFICER VIK: Just thank you so much for joining us, and we look forward to speaking with you all as our projects advance and we have more specifics to share. Thank you and I hope this is the first of many conversations.

MODERATOR: Thank you so much. Thank you to all the journalists joining us today. We'll provide a transcript of the briefing as soon as it's available. If you have any feedback or further questions, please feel free to contact us at [email protected]. Thanks again, and we hope you can join us for another briefing soon. Take care.

# # #