There are nearly 60 other export credit agencies around the globe.
Ex-Im helps level the playing field for U.S. companies.
The Export-Import Bank of the United States (Ex-Im) is one of the most important tools at the disposal of U.S. companies to increase exports and create jobs. The benefits of its programs to the U.S. economy are plain: In fiscal year 2013, Ex-Im provided financing or guarantees for $37.4 billion in U.S. exports, thereby supporting more than 200,000 American jobs.
Ex-Im is especially important to U.S. small- and medium-sized businesses, which account for more than 85% of Ex-Im’s transactions. In addition to these direct beneficiaries, tens of thousands of smaller companies that supply goods and services to large exporters also benefit from Ex-Im’s activities.
Unilateral disarmament is rarely a good idea, but this is precisely what refusing to reauthorize the Ex-Im Bank would accomplish. The Organization for Economic Cooperation and Development (OECD) reports that 60 official export credit agencies (ECAs) worldwide have extended more than $1 trillion in trade finance in recent years. Governments from Canada to China have shown no interest in shutting down their ECAs. On the contrary, German and French ECAs extended roughly two and a half times as much export financing — measured as a share of GDP — as Ex-Im did in 2012; Chinese and Indian ECAs provided almost three times and Korea’s ECA ten times as much as Ex-Im.
Ex-Im loans expose the U.S. taxpayer to little risk as they are backed by the collateral of the goods being exported. Borrowers have defaulted on less than 2% of all loans backed by Ex-Im over the past eight decades, a default rate lower than commercial banks.
Some critics charge that Ex-Im picks winners and losers, skewing the marketplace. On the contrary, Ex-Im extends loans and guarantees to all applicants that meet its strict lending requirements but does so only when commercial credit is unavailable or when it is necessary to counteract below-market credit from foreign ECAs. Refusing to reauthorize Ex-Im would reduce the number of ECAs worldwide from 60 to 59, harming only U.S. exporters and the workers they employ.
Finally, American taxpayers can cheer the fact that Ex-Im helps reduce the federal deficit by hundreds of millions of dollars. Far from being a subsidy for corporations, Ex-Im charges fees for its services that have generated billions of dollars in revenue for the U.S. Treasury. In fiscal years 2012 and 2013, Ex-Im returned $1.1 billion to the U.S. Treasury after covering all its expenses and transferred these funds to the U.S. Treasury’s General Fund.
The U.S. Chamber of Commerce urges Congress to support Ex-Im. Show your support―send a send a letter to Congress today.
Learn More about the impact of Ex-Im Bank.