Ex-Im Bank Chairman Says American Businesses Can Successfully Compete Against Foreign Companies, Not Countries
Releases 2012 Competitiveness Report, unveils study showing unregulated government financing exceeds all official export financing of the G-7 ECAs combined
WASHINGTON, June 25, 2012 /PRNewswire-USNewswire/ — The chairman of the Export-Import Bank of the United States (Ex-Im Bank), Fred P. Hochberg, said today that American companies’ ability to win foreign sales is being challenged by a dramatic rise in official export credit financing. He made the remarks at the Center for American Progress.
Hochberg also outlined how the United States can become the world’s leading exporter again and how American businesses can compete globally amidst the rise of state-driven capital.
Following his speech, Hochberg released Ex-Im Bank’s 2012 Competitiveness Report. The Bank has produced these reports for Congress annually since 1972, and this year’s report examines the challenging trends in export finance driven by both OECD and non-OECD economies.
Excerpts from Hochberg’s speech, “A Wake-Up Call on American Competitiveness”
- “For the foreseeable future, our economic competitors will strongly support their companies, and industries that serve their national strategic interests. They will continue creating their own national champions. And how America responds to this will determine if we can create the millions of middle class jobs our nation needs today and in the years ahead.”
- “There are over 60 export credit agencies around the world, and each and every one is working to expand their footprint and increase their activity. This is the world we live in. And we’ve got to compete in the world as it is, not as we’d like it to be.”
- “American companies have what it takes to win in the global economy. They can go head-to-head with any company in the world. But they can’t go head-to-head with the government of another country. President Obama is right. We need a government that will fight for our economic interests around the world, to create more American jobs at home. There is no time to wait. It’s time to get to work.”
Key findings from Ex-Im Bank’s 2012 Competitiveness Report
- Against the backdrop of the European sovereign debt crisis and tight liquidity constraints, Ex-Im Bank has proven itself ready and able to step in with its long-term, fixed rate support for U.S. exports when the private sector had withdrawn from export finance.
- However, as the recovery continues and liquidity gradually returns to commercial markets, different competitive challenges are emerging.
- Most notably, significant volumes of unregulated OECD export credit programs (that fall outside the purview of the Organization for Economic Co-operation and Development “OECD” rules) and non-OECD export programs, such as those offered by Brazil, India, and, most prominently, China, are being deployed strategically around the globe, in favor of foreign exporters and national champions. In fact, a conservative estimate shows that, collectively, these forms of government financing exceed all official export finance activity of the G-7 ECAs combined.
- Ex-Im Bank estimates that in 2011 there was roughly $100 billion in unregulated OECD export financing and an additional $60 billion from Brazil, India, and China.
About Ex-Im Bank:
Ex-Im Bank is an independent federal agency that helps create and maintain U.S. jobs by filling gaps in private export financing at no cost to American taxpayers. In the past five years, Ex-Im Bank has earned for U.S. taxpayers $1.9 billion above the cost of operations. The Bank provides a variety of financing mechanisms, including working capital guarantees, export-credit insurance and financing to help foreign buyers purchase U.S. goods and services.
Ex-Im Bank approved $32.7 billion in total authorizations in FY 2011 — an all-time Ex-Im record. This total includes more than $6 billion directly supporting small-business export sales — also an Ex-Im record. Ex-Im Bank’s total authorizations are supporting an estimated $41 billion in U.S. export sales and approximately 290,000 American jobs in communities across the country. For more information, visit www.exim.gov.
SOURCE Export-Import Bank of the United States