The current charter for the Export-Import Bank expires September 30 and industry groups are rallying for swift reauthorization. Four years ago, the road to reauthorization was difficult, with activity disrupted for weeks. As we wrote in December 2015,
In this trade-dependent state, the bank’s reauthorization has been a top priority for business groups.
This year’s path is likely to be easier. But advocates take little for granted. That’s why new research from the Washington Council on International Trade is timely and welcome. WCIT sets the stage,
Washington’s economy depends on exports and imports of goods and services by companies of all sizes, from small and medium sized enterprises (SMEs) to some of the largest companies in the world. Approximately 40% of all jobs in Washington are tied to trade, making us the most trade dependent state in the nation. In 2018, Washington was the 4t h largest exporting state by value for merchandise and commodities after Texas, California, and New York.2
For hundreds of Washington exporters operating in dozens of industries, a crucial element of their success is the support they receive each year from the Export-Import Bank of the United States, the official export credit agency of the federal government. The mission of the Ex-Im Bank is to fill gaps in private export finance in order to bolster U.S. job growth. Because it is backed by the full faith and credit of the United States, the Ex-Im Bank assumes credit and country risks that the private sector is unable or unwilling to accept. This briefing looks at the importance of the Ex-Im Bank to Washington state trade, particularly as the bank approaches an important deadline for reauthorization by September 30, 2019.
WCIT notes that the 2015 reauthorization of the bank was not the end of the challenges.
Despite being reauthorized in 2015, the Ex-Im Bank was not fully functional until May 2019 when the Senate confirmed three new appointments to its board, restoring its quorum and allowing the bank to approve transactions greater than $10 million.6
The report provides much useful data and plenty of examples of how the Ex-Im Bank boosts trade in our state. We’ll cut to the conclusion and commend the study to your attention.
For the past 85 years the Export-Import Bank has provided vital assistance to U.S. companies and their employees by enhancing their ability to engage in international trade. Because the Ex-Im Bank assumes credit and country risks that the private sector is unable or unwilling to accept, its assistance is especially critical for small and medium enterprises (SMEs) that otherwise might not be
able to compete in global markets. That is why 90% of companies assisted by the Ex-Im Bank are small businesses. The support of the Ex-Im Bank is especially important to SMEs in Washington state, where roughly 40% of all jobs are tied to international trade. In diverse sectors ranging from wine to metal fabrication, aerospace and seafood, Ex-Im Bank trade assistance – ranging from Direct Loans to Export Credit Insurance – helps close deals and strengthen Washington businesses.
The U.S. Chamber of Commerce last week wrote members of the Senate urging reauthorization. And the National Association of Manufacturers also endorsed proposed legislation extending the charter. From the NAM statement:
We need long-term certainty that the Ex-Im Bank will be able to continue helping manufacturers of all types and sizes secure new sales overseas that support well-paying American jobs. This bipartisan legislation—through its 10-year reauthorization of the agency and fixes to its past quorum issues—will help do just that and marks an important step forward toward reauthorization. Manufacturers appreciate the work of members on both sides of the aisle to move forward a robust Ex-Im reauthorization and urge both chambers of Congress to work together to reauthorize the agency before the September 30 deadline. The more than 12.8 million men and women who make things in America are depending on it.
More from Reuters here.