David Bohigian, center, with the Armenian American Chamber of Commerce (photo: courtesy OPIC)

Bohigian Discusses Journey from Commerce to OPIC to Role in Armenia


WASHINGTON – David Steele Bohigian is a man on a mission, constantly traveling to countries around the globe to promote American values and business investment, along with the free market economic system. On September 18, he briefed members of the Armenian community and various organizations and agencies dealing with US-Armenia trade issues on his recent visit to Armenia as second in command of the Overseas Private Investment Corporation (OPIC) of the United States. The next day he offered a follow-up interview to the Mirror-Spectator at the art deco style OPIC headquarters in Washington.

Amb. Grigor Hovhannisian, left, and OPIC Executive Vice President David Bohigian at the Armenian embassy in Washington (photo: Aram Arkun)

The briefing and the reception which followed was hosted by the Embassy of the Republic of Armenia. Ambassador Grigor Hovhannisian introduced Bohigian and a number of the prominent guests present. Hovhannisian provided the context for the evening when he said, “Since the early days of the Trump administration we are contemplating a shift in paradigm in the type of relationship we are building with the United States, which was previously aid-centered. We are transitioning into a partnership, a trade-centered development… It is important for us to intellectually understand what a small landlocked country like Armenia with limited resources can offer the US, what kind of partnership Armenia can offer the US. The asymmetry is tremendous. This is not a simple type of partnership. The United States is not a country by Armenian standards, it is a continent, it is a universe, so Armenia needs to find its niche and US investors need to find an area of focus, and that is where I think OPIC and some of your colleagues can come in handy.”

Bohigian started by defining OPIC’s objective as to “help advance development goals and US foreign policy in countries around the world.” He said that he thinks of OPIC as the successor of the Marshall Plan which after World War II helped rebuild the economies of Europe. OPIC provides political risk insurance and project finance and supports private equity firms. It operates under the policy guidance of the Secretary of State. Everything that it does provides a profit to the United States government, including over $250 million last year alone.

Bohigian, with his colleagues Carol Danko and John Didiuk (both present at the talk), and others, briefly visited Armenia, Georgia, Azerbaijan and Uzbekistan from August 13 to 17. This trip was, Bohigian said, “part of our outreach to the region to support democracy and support capitalism as opposed to state-owned enterprises.”

At present, OPIC is supporting 32 projects in the three countries of the Caucasus at a total value of over $167.8 million. Of this, the lion’s share goes to Georgia, in which OPIC currently has $138 million invested in 21 projects. It currently has $11 million invested in Azerbaijan and the same amount in Armenia. However, while Armenia has received $88 million in total in the past few decades (including an $18-million loan for the Armenia Marriott Hotel), Azerbaijan received, as of 2015, around $230 million through OPIC. Georgia has received $618 million in toto, and Uzbekistan $231 million.

The six ongoing projects in Armenia include two with the First Mortgage Company, the Microvest Short-Duration Fund LP (loans to low-income financial institutions for microfinance on-lending), Eurasia Foundation-Armenia, Armenia Marriott Hotel complex, and Chemonics International Inc. (risk insurance for technical assistance contracts). The Gazelle Fund is a seventh project not included in the above list because it is a regional investment across five countries including Armenia.

David Bohigian (photo: Aram Arkun)

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In Armenia, the OPIC delegation met with Deputy Prime Minister Tigran Avinyan, Minister of Economic Development and Investments Artsvik Minasyan and members of the American Chamber of Commerce. They saw the Innovative Technology Solution Center (a public-private partnership between USAID and IBM) at Yerevan State University. They visited some first-time homebuyers who benefited from the First Mortgage Company. OPIC financing allowed First Mortgage to be able to extend the length of its loans and reduce the interest rate, making home ownership more affordable. Finally, they inaugurated the Gazelle Fund in Armenia. This is a venture capital private equity firm which previously was active in Georgia helping to support small and medium size enterprises of all sorts, including dry cleaners, bakeries, hotels and schools. Bohigian said that it would follow a similar approach in Armenia.

David Bohigian, left, visits with Armenian homeowners supported by the First Mortgage Company (photo: courtesy OPIC)

This was Bohigian’s second trip to Armenia. In 2008 he went as an official of the US Department of Commerce. Bohigian related his first impression of his present trip: “When you are in Republic Square, I will tell you, there is no better energy anywhere in the world today. I have traveled to 50 countries in the world, I have been to Times Square more times than I can count, but the energy in Republic Square, the sense of optimism, is truly palpable. We want to be able to support that freedom, that energy, that democracy with the youth. It was midnight on a Monday night and it was more crowded than you will find in Dupont Circle, and more energy than you will find in Times Square. It was really wonderful.”

From left, OPIC Executive Vice President David Bohigian meets with Armenian Deputy Prime Minsiter Tigran Avinyan and US Ambassador to Armenia Richard Mills, Jr. (photo: courtesy OPIC)

He hopes that Americans, including members of the Armenian-American community, will invest more capital in Armenia, after the recent political changes there. He said, “We think that the Velvet Revolution has given us an opportunity to work more closely to really support what I think of as a fulcrum of freedom. We want to support the Armenian people in their pro-democratic and pro-capitalist reforms so they are able to develop their own economy as the ambassador was saying, with the private sector.” This support will not be through aid but through economic partnership and relations.

He noted later that evening that “When we talked about priorities with the ministries and the prime minister’s office there, the longer the meeting went on, the more priorities and the more ideas we had, which is a wonderful problem to have.”

There are two important conditions that Bohigian told government officials in Armenia had to be realized in order to get more investments there: more legislative anti-corruption measures insuring transparency in the marketplace and more political certainty, meaning getting past the parliamentary elections, which Bohigian hoped would be early next year. This would allow an elected government to be able to put its own platform into place.

During the question session of the presentation, Bohigian avoided making any direct comparisons between Armenia and the other countries he visited. OPIC International Project Finance Director John Didiuk reported that their recent trip led to a number of project leads. He added in more detail after the event that these leads concerned renewable energy, education, IT, hotels outside the capital and on-lending projects, where OPIC would make a loan or lending to an Armenian bank, investment fund or special purpose vehicle, with US connections, which would in turn use that money (“on-lend”) to make loans to small and medium size enterprises in Armenia. Gazelle Finance and First Mortgage are examples of existing on-lending projects in Armenia.

Bohigian told the audience that this is the most opportune time to promote Armenia economically due to all the attention it has been getting after the revolution. He said, “I think if you want to create a wave of investment, the eyes of the world are on Armenia now, whether that is the New York Times travel section, or the Wall Street Journal talking about the political revolution. So if you can capitalize on that attention in a positive way, then you will be able to catalyze investment on a scale that no government is going to do in the 21st century. When we look at the needs around the world, there are no combination of governments that can meet those. It is going to be the private sector. That is how I think a 21st century Marshall Plan happens: a country like Armenia attracts investment, which in turn has a virtuous cycle creating more entrepreneurship and more investment.”

In an interview the day after the briefing at the Armenian Embassy, Bohigian expanded on some points and spoke about his own background. His grandfather was born in 1910 in the village of Darman, 200 miles east of Ankara, in the Kghi district of Erzerum. Bohigian recalled a break-a-leg story about his grandfather, with the twist that it was the horse of the messenger sent to inform neighboring villages of the birth of a son that broke its leg. This was considered good luck, Bohigian wryly related, maybe because it was not the baby that was hurt.

Bohigian’s grandfather hid in a barn in 1915 while his village was destroyed by Turks. He left at the age of five with his mother, traveling across Asia to escape to Pennsylvania. He eventually settled in St. Louis, where he became a dry cleaner. Bohigian’s father George became an ophthalmologist, and as such has been to the Republic of Armenia a number of times as part of the Armenian Eyecare Project. Dr. Bohigian speaks some Armenian and he and his sister attend the Armenian church in Belleville regularly. David confessed that he himself has been unsuccessful at learning Armenian.

Bohigian said that growing up, he was interested in two things: student government and being an entrepreneur. He said, “I think that from a young age, those two strains have been an important part of my career, and journalism was a way to make sure that I can communicate those ideas.” Indeed, he ended up with a journalism degree from Washington and Lee University and afterwards earned a law degree from Washington University in St. Louis in 1995. Bohigian said, “Law was a way to sharpen those tools and thinking, but I really didn’t expect to become a lawyer and wasn’t a lawyer.”

After law school, he came to Washington to work for Speaker Newt Gingrich in his first 100 days. Bohigian exclaimed, “that was an amazing time in US policy!” Then he moved to a venture capital firm. He said, “Throughout my career, I have gone back and forth from helping to grow businesses to policy roles.”

After he sold a venture capital firm he founded, VenCatalyst, to the Pasadena-based Idea Lab in 2000, he moved to Los Angeles, New York and then London. In London he was asked by George W. Bush administration in 2002 to join the Commerce Department, where he held a number of positions, including Director of Policy and Strategic Planning, covering, as he said, everything from economics to the census to the National Oceanic and Atmospheric Administration, which itself handles everything from salmon to weather.

He moved into a trade role as Assistant Secretary of Commerce for Market Access and Compliance, where he worked to ensure that there is a level playing field for US businesses when they compete overseas. It was in this role that he visited Armenia, and 50 other countries around the world, to talk about economic reforms.

He left Commerce in 2009 to start an energy efficiency fund, E2 Capital Partners, to help retrofit buildings with energy efficient equipment, which Bohigian called “a good way to do well and to do good.” He moved from there into the world’s largest hedge fund, Bridgewater Associates based in Connecticut and then in 2013 started his own firm, Pluribus Ventures, which was doing impact investing as well as advising financial services firms.

At the end of November 2016, he was appointed to President Donald Trump’s Commerce Department transition team. In February 2017 he became a special adviser to the US Treasury Department, and in early August 2017, was confirmed by the Senate in his OPIC post.

When asked the day after his event whether he might eventually go directly into politics, Bohigian replied: “This is the best of all my other jobs combined. Honestly, to be able to work on economic policy on behalf of the US government, I think is in alignment with my values, abilities and skills. I think what is important about the executive branch is that you can focus where you can most have value. If you are in the judicial branch, you see the cases that come before you. If you are in the legislative branch, you see the legislation that comes before you. Here, I feel like the Overseas Private Investment Corporation has a chance to shape foreign policy, in the way we can be forward leaning and be able to help direct investment to the places that need it most to advance foreign policy and development goals. That is why I love this job in the executive branch.”

He said that his work focuses primarily on catalyzing private sector capital to create prosperity in low and middle income countries. For example, in the northern triangle of Guatemala, El Salvador and Honduras, OPIC tries to improve economic conditions to reduce emigration to the US.

Bohigian partially sidestepped questions both at the event at the embassy and later at his office as to the problems that Russia might create in Armenia for OPIC and US efforts to encourage economic and political change and realignment due to strong Russian control of many sectors of Armenia’s economy and its predominant military and political presence in the region. He commented that the Marshall Plan after World War II showed the success of the American approach compared to Soviet attempts to dominate Eastern Europe behind the Iron Curtain. He added that the people of Armenia have chosen democracy for themselves and their economy has grown, so that its “entrepreneurs are committed citizens, who are pushing not just democratic reforms but also economic reforms that I think lead to pro-growth opportunity societies in a way that is very difficult to counter from any sort of state-directed investment program or political program.”

At the briefing, Bohigian answered a question about the future of OPIC. He said at this time last year, OPIC was going to be eliminated, as it was seen as aid, but the Trump administration has made a 180-degree turn on this position and now is backing the expansion of the development finance approach. It supported legislation, the Build Act, to effectively double its size and give it new authorities. This bill passed the House of Representatives but must now get through the Senate. One of its foreign policy goals is to counter Chinese attempts to restructure global trade routes.

When asked the next day how the fate of this legislation would affect future OPIC projects in Armenia, Bohigian said that as current legislation allows OPIC to operate in 90 countries with a $23-billion portfolio, which can be expanded by 6 billion dollars, “we are not slowing down. We will continue to invest. We hope to expand our operations in places that are supporting additional investment. We hope Armenia is one of those places.” If the new legislation passes the portfolio could be expanded up to $60 billion and new authorities would be given, such as the ability to invest equity.

[This article will have a video component on Mr. Bohigian’s speech added by October 8, if not earlier]

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