What’s often lost in the ongoing debate over the reauthorization of the Export-Import Bank is how we are being out-paced by our global compeittors when it comes to export financing. If we are truly going to meet the goal of doubling exports by 2014 then the Ex-Im Bank will play an important role and its lending limit must be increased.
The editorial staff at Bloomberg View agrees that the Bank must be reauthorized posting an editorial yesterday titled, “Export-Import Bank Is U.S. Growth Engine That Can Do More: View.” In the piece they state how we are being left behind by our competitors including China.
Equipping the bank with the tools it needs to help U.S. exporters (USTBTOT) has long made sense, but it’s even more critical now, as emerging markets begin making aggressive use of trade financing. Rather than adhering to international standards set by the Organization for Economic Cooperation and Development, countries such as Brazil and China are offering much more generous terms to give their own exporters an advantage. China has begun offering lower interest rates or longer repayment terms than international guidelines allow. In 2010, China supplied $45 billion in long-term export loans and loan guarantees, while the U.S. provided just $13 billion, according to a Bloomberg Government analysis. Last year, the U.S. for the first time agreed to match China’s cheaper financing terms to get the Pakistani government to buy those GE trains.
They stress that it would be “irresponsible” to not reauthorize the Bank.
Given the weak recovery and the need for exports to power economic growth, it would be irresponsible to pull the plug on the Export-Import Bank.
The time is now for Congress to move forward with reauthorizing the Ex-Im Bank for our economy and jobs.