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President's Export Council Calls for TPA, Renewed Ex-Im Bank

Jun 19, 2014

The President's Export Council today reaffirmed its call for an aggressive agenda to expand trade, urging President Obama to work with Congress for quick action on Trade Promotion Authority and reauthorization of the Export-Import Bank.

Passing modernized Trade Promotion Authority legislation is critical for completing such negotiations as the Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership, the private-sector members of the council wrote in a letter to the president:

Passage of TPA would: (1) reassure our trading partners of Congress’ commitment to high-standard and ambitious outcomes in these negotiations;  (2) promote transparency and ensure appropriate mechanisms for input by Congress and other stakeholders; and (3) help facilitate Congressional review and consideration of these agreements. A cohesive executive and legislative perspective on trade is a key element of ensuring strong final agreements that support the U.S. domestic economy and our companies, workers, and exporters.

The letter was signed by the council's chairman, Jim McNerney, Chairman and CEO of Boeing and former chairman of the Business Roundtable. The council also sent a letter urging action on TPA at its last meeting in September 2013.

Separately, the council stressed the importance of reauthorizing the Export-Import Bank before it expires at the end of September, making three key points:

Ex-lm Bank financing  supports small business.  In fiscal year 2013, Ex-lm Bank supported a record number of small businesses.  Nearly ninety percent of all Ex-Im transactions directly supported small businesses while thousands of additional small businesses benefitted by supplying medium and large business exports.  From the medical market in Latin America to the agricultural products market in Asia, thousands of small businesses across the country would not be able to compete in international markets without the support Ex-Im Bank financing provides.

Ex-lm Bank financing increases U.S.competitiveness. Some sixty countries around the world use export credit agencies to support their businesses in the global marketplace. Many are much more aggressive in using such programs and we urge the Administration and the United States Congress to negotiate bilateral and multilateral agreements that are fair, consistent and transparent around the use of such financing. Unilateral disarmament in export credit financing only harms American workers.

Ex-lm Bank financing earns money for taxpayers. The Bank charges fees and interest on all transactions. These fees cover all of Ex-Im Bank 's operating costs, provide for appropriate loan loss reserves, and ultimately earn money for the United States Treasury. Since 2009, Ex-Im Bank has generated over $2 billion to contribute to the Treasury Department's General Fund, including more than $1 billion in fiscal year 2013 alone. Since 1934, Ex-Im's net losses on its entire portfolio have been less than 1.5 percent, and as of their March 31st report to the Congress, the Bank's default rate was less than a quarter of one percent (0.211 percent).

The reauthorization should be for five years, the private-sector members wrote, and Congress should consider raising the portfolio limit to $160 billion.

In his prepared remarks to the council, President Obama hailed U.S. trade successes, noting that the United States exported a record $2.3 trillion in goods and services last year. He did not mention Trade Promotion Authority or the Export-Import Bank.

Other letters from the council:

 

 

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