September 24, 2014 | Industry Insights

Congress Holds Off on Deciding Export-Import Bank’s Fate Until Next Summer

Share This:
Featured Image

Congress Holds Off on Deciding Export-Import Bank’s Fate Until Next Summer

The operating authority of the Export-Import Bank (Ex-Im Bank), the federal government’s export credit agency, was set to expire next week on September 30th but has received temporary reprieve after Congress approved a short-term extension of its charter. House Speaker John Boehner included a measure temporarily extending the export credit agency’s authority until June 30th as part of a broader deal that was tied to a stop-gap bill to fund the government through December 11th.

The Ex-Im Bank offers loans to foreign buyers of U.S. products, and insurance and other assistance to domestic exporters at no annual taxpayer cost. The bank pays for its operations through interest and fees on its assistance. In 2013 Ex-Im provided $27.7 billion in export assistance for more than 3,400 companies and sent a record $1.1 billion in profit to the Treasury.

With the Ex-Im’s June 30th extension in lieu of the five-year reauthorization sought by the Obama administration, many are concerned over its ultimate fate. Chris Krueger, a senior analyst at financial services firm Guggenheim Partners, noted in an article published by the Los Angeles Times that the extension of the bank’s charter was only a temporary reprieve. “Ex-Im received a stay of execution, but it remains on death row,” he said.

The debate over Ex-Im stems from conservatives who view it is as another example of “corporate welfare” and complain that the bank mostly aids Boeing and other large companies. But trade advocates say the Ex-Im Bank is critical, particularly for small businesses, to overcome challenges when operating in foreign markets. They argue for Ex-Im’s reauthorization because it helps keep U.S. businesses competitive in emerging markets. They also note that other countries, such as China, have government financing options similar to the ones offered by the Ex-Im Bank, which means that nixing the bank would simply boost America’s competitors.

Ex-Im President Fred Hochberg said he would continue to seek a long-term reauthorization from lawmakers. “Quality American goods shouldn’t lose out to aggressive foreign competitors because of the Export-Import Bank’s still-uncertain future,” said Hochberg, who underscored that about 60 other countries have similar export-assistance agencies to help their companies sell products abroad.

Moreover, the U.S. Chamber of Commerce, the National Association of Manufacturers and nine other business trade associations wrote to congressional leaders last week urging them to quickly provide a long-term extension of the bank’s charter. “Without Ex-Im Bank acting as a ‘lender of last resort’ to fill market gaps, many foreign customers may turn to non-U.S. suppliers that already have significant support from their own official export credit agencies,” the groups wrote.

Roanoke Trade is the leading provider of insurance and surety solutions for transportation and logistics providers. In fact, we are recognized as the most reliable source for U.S. customs bonds. As such we are committed to keeping our constituents updated on developments that affect their operations. For more information on the issues affecting your organization, continue to turn to our Industry Insights column. If you would like more information about our products and services, contact us at 1.800.ROANOKE.

Sources: American Shipper, LA Times, The Hill

 

Share This:

Related


How to Protect Your Company from Nuclear Bodily Injury Verdicts

The liability landscape for the trade and transportation industry is changing. Carrier accidents on the road resulting in bodily injury and property damage (BIPD) claims pose a real financial threat to brokers, forwarders, and other transportation intermediaries. Recently, the number of large trucks involved in fatal crashes and the resulting jury awards have skyrocketed. Inconsistent application of the law has put the burden of these “nuclear verdicts” on not just the carriers but also the broker-forwarders responsible for hiring the carriers. This volatile litigation landscape and the rise in “nuclear verdicts” has specifically led to two related issues for transportation […]

Industry Insights

2024 NCBFAA Scholarship & Application Announcement

Roanoke Insurance Group is delighted to once again sponsor  a $5,000 scholarship to students intending to join the trade industry. The National Customs Broker and Forwarder Association of America (NCBFAA) offers this $5,000 scholarship award yearly and will be presented to the winner at the NCBFAA annual conference in April 2024. The topic for this year’s scholarship will be “What are the key steps an organization should take to ensure that training, auditing, and engagement with a licensed customs broker and the sharing of industry information are effectively relayed to all employees, as well as properly documented to substantiate compliance […]

Events, Industry Insights

Danielle Kurtzer: Charting New Territories as Roanoke’s RVP of Charleston

It is with great pleasure that we announce the promotion of Danielle Kurtzer to the role of Regional Vice President of our Charleston office, effective February 1, 2024. This is a significant milestone for Danielle and all of us at Roanoke, as she brings a wealth of experience and leadership to this pivotal role. Danielle’s journey in the insurance industry is nothing short of inspiring. With over 30 years under her belt specializing in Surety Bonds, Cargo Insurance, and Property & Casualty Insurance, she has proven herself to be a formidable force in the field. Her tenure at Roanoke began […]

Industry Insights

Roanoke is the leading provider of insurance and surety solutions for transportation and logistics providers. In fact, we are recognized as the most reliable source for U.S. customs bonds.

Contact

If you have any questions or need help, feel free to contact with our team.

800-762-6653
US Flag

US CORPORATE HEADQUARTERS

1501 E. Woodfield Road

Suite 400W

Schaumburg, IL 60173


Canada Flag

CANADA CORPORATE HEADQUARTERS

390 Bay Street

Munich Re Centre, 22nd Floor

Toronto, ON M5H 2Y2

Solutions that Go the Distance.

© 2024 Roanoke Insurance Group Inc.

Better Business Bureau logoCoverholder at Lloyd's logo