October 23, 2015
5 Facts on the Export Import Bank
After being closed over 100 days, the conversation to renew Ex-Im’s charter is firing up again. Those opposed to reauthorizing the Bank argue that it’s nothing more than taxpayer funded assistance to the largest corporations. They say that it boosts foreign economies while failing to benefit ours – especially failing to help small business – and that American companies are getting by just fine without Ex-Im. Those arguments couldn’t be farther from the truth. Here are 5 facts to remember on Ex-Im:
Fact 1: 27 countries require support from an export credit agency before even considering a bid for a project from an American company. Those countries account for 40 percent of the world’s population and over 10 percent of global GDP. Without Ex-Im, U.S. companies can’t compete for project contracts in these countries, and that takes a huge toll on business. For example, 80 percent of General Electric’s aviation-related turbine business came from those 27 countries. Without Ex-Im, GE is forced to either move jobs to countries that have an active export credit agency, or abandon those projects completely.
Fact 2: 89 percent of all of Ex-Im’s authorizations went to small businesses in FY 2014.
Fact 3: Since the Bank has been shut down, 1,045 loans to small business have gone unauthorized totaling over $1.59 billion in support to those small businesses in their pursuit of international projects.
Fact 4: The number of authorizations to small businesses has grown every year since FY2009, and is more than double its pre-financial crisis numbers.
Fact 5: Additionally, those who argue against reauthorization of Ex-Im’s charter fail to consider the international context. For example, in 2013 and 2014, just three Chinese export credit agencies were responsible for 8 times the financing of Ex-Im. That puts American companies at a disadvantage when Chinese companies are so much more easily able to obtain the funding they need to compete for export projects. Since the recession, demand for Ex-Im authorizations to the least developed countries and emerging markets rose 486 percent. So not only is Ex-Im support directly benefitting American companies, but it’s benefitting the markets where their products and services are ending up.