Statement on the Importance of Passing International Development Finance Corporation Reauthorization in the FY26 National Defense Authorization Act

The International Development Finance Corporation (DFC) must be reauthorized in this year’s National Defense Authorization Act (NDAA). If not, US companies will lose a key tool for international equity investments, critical projects will stall, and it will be harder for the US to compete with China.

The DFC has committed billions of dollars in political risk insurance, equity guarantees, and loans to strategic investments, including Ukrainian reconstruction, central Europe’s diversification away from Russian energy, Indo-Pacific strategic projects, and the development of critical infrastructure. Unless it is reauthorized, its ability to support America's allies, interests, and priorities abroad will grind to a halt.

Innovative and strategic US technologies can only become commercially viable enough to contribute to the DFC’s mission through access to mature markets in high-income countries (HICs), with the government programs and infrastructure needed to support them. Projects on the path to commercialization require DFC’s equity finance and longer-term loans. The DFC must continue supporting projects of legitimate national interest in HICs without infringing on its overall capacity to support projects in developing nations.

The Senate’s version of the reauthorization bill finds a middle ground in supporting projects in HICs and developing countries, and has bipartisan co-sponsorship by Senators Risch and Shaheen. In the House, HFAC Chairman Mast proposed a White House-backed bill with a far less rigid restriction on HIC engagement, raising concerns about the erosion of the DFC’s development mandate. This bill has faced opposition from Ranking Member Meeks, and negotiations on the text are ongoing. 

Third Way shares Ranking Member Meeks’ concerns about the broad dissolution of many US foreign aid functions. But we urge the House to send a pragmatic bill to conference. Above all, we support a bipartisan and measured approach like the Senate’s, which preserves the DFC’s focus on developing countries while still providing flexible yet limited investment opportunities in strategic HICs. 

Failing to reauthorize the only US agency that provides equity and loans abroad would gut our ability to compete and leave America without a serious tool for global development. The DFC is critical to unlocking private sector investment in the world’s poorest countries. Sending a workable House text to be conferenced with the Senate’s is the first step to make sure it can continue.