WASHINGTON—U.S. Senator Chris Murphy (D-Conn.), a member of the U.S. Senate Foreign Relations Committee, on Wednesday applauded passage of his amendment to allow the United States to better compete with Chinese development finance institutions. Murphy’s amendment specifically 1) Increases the Development Finance Corporation (DFC)’s liability limit from $60 billion to $100 billion to better compete with Chinese development finance institutions and (2) clarifies the intent of Congress that DFC equity investments should be scored as federal credit programs, not direct spending. Fixing this problem would allow the DFC to do significantly more projects with the same amount of appropriated funding. Murphy’s amendment passed as part of the Strategic Competition Act of 2021 (S. 1169).
“If we want to compete with China, we need to make sure we level the playing field on development finance. That’s why I introduced an amendment in today’s markup to dramatically increase the capacities of the Development Finance Corporation so we can strike international development deals that are good for the world and our partners,” said Murphy. “China is running circles around the United States when it comes to development finance investments, particularly in developing nations, but the United States is still the partner of choice for most countries – if we can offer that choice by putting more potential deals on the table. I’m glad the Committee passed my amendment to step up our own efforts in a positive way and counter Beijing’s growing influence.”
In March, Murphy along with U.S. Senator Chris Van Hollen (D-Md.), U.S. Representative David Cicilline (RI-01), and U.S. Representative Ami Bera (CA-07) proposed a significant increase to the international affairs budget for Fiscal Year 2022 to better address America’s national security challenges. Investing in 21st Century Diplomacy calls for a $12 billion increase, directing the funding toward three specific challenges: (1) competing with China; (2) preparing for the next pandemic in a post COVID-19-era; and (3) fighting climate change. In this budget proposal, Murphy specifically proposes an increase in funding for the DFC as a way to compete with China.