By Roman Olearchyk, Kyiv Post Staff Writer
Kyiv Post, Kyiv, Ukraine, Mar 18, 2004

On March 12, OPIC announced plans to provide $3.8 million in political risk insurance to Hansen, Inc., an American company involved in establishing a joint venture to manufacture suspension systems for railroad freight cars in Ukraine. OPIC's mission is to encourage private investment in emerging markets by providing private investors with political risk insurance and financing.

The OPIC insurance will minimize the risk of participating in the joint venture project, which will be involved in the manufacture of railroad freight car suspension systems, friction wedges, side bearings, and center bowl liners, to be sold primarily in Ukraine. Additionally, the OPIC insurance will cover the lease of Hansen's manufacturing equipment and use of its patented technology. Hansen, Inc. is based in Pittsburgh, Pennsylvania.

"This project will help support Ukraine's economy," Peter Watson, president and CEO of OPIC, said in a March 12 statement. The country's economy relies heavily on industrial activities and its rail system.

Tim Harwood, a spokesperson for OPIC, said on March 15 that the claim involves $17.7 million in funds provided by OPIC to a company called Alliant for a project involving the conversion of munitions into metals.

"In the memorandum concluded between OPIC and the Ukrainian government, both parties agreed to resolve the case," Harwood said.

Watson said OPIC's return to Ukraine "sends a message to potential U.S. investors that Ukraine has resolved to be a partner to American companies interested in doing business in this resource-rich nation."

Continued OPIC activity in Ukraine depends on the prompt settlement of outstanding disputes with American companies. Only by resolving these disputes and committing itself irrevocably to economic reforms, will Ukraine become an attractive destination for foreign investment, Watson said.

"Once settlement is achieved, OPIC looks forward to working with Ukrainian businesses and the Ukrainian government and expanding our activity in the country," Watson added.

OPIC, as U.S. government agency, was established in 1971 to help American businesses invest overseas, and to foster economic development in emerging markets. OPIC says it charges market-based fees for its services, rendering it self-sustaining and cost-free for U.S. taxpayers.

OPIC has provided services to U.S. companies in more than 150 emerging markets and developing nations over its 32-year history, supporting $150 billion worth of investments that have helped developing countries generate over 690,000 host-country jobs. OPIC says its projects have also generated $66 billion in U.S. exports and created more than 257,000 American jobs