As the June 30, 2015 deadline approaches for the U.S. Congress to reauthorize the charter of the Export-Import Bank of the United States, Oklahoma businesses face an uncertain future as some in Congress balk at it’s continuation.
On April 15, EXIM President Fred Hochberg was grilled by some members of the House Financial Services Committee skeptical of his leadership and the bank’s mission in providing funding for American exporters. Critics of the bank accuse its mission of being little more than taxpayer-funded corporate welfare for large multinationals. Another point of contention by Congressional critics is that the U.S. Treasury Department officials have not negotiated with foreign governments to end subsidized exporting, a mandate in a 2012 re-authorization bill by Congress.
In Oklahoma, public support for fiscally conservative policies for taxpayer funded organizations like EXIM can run in contrast to the positives international exporting can have on local, small businesses. The bank helps underwrite loans for American products sold abroad, meaning Oklahoman exporting companies can acquire a guarantee for their investments in personnel and infrastructure.
- Oklahoma has 125 exporters whose total export value is $1 billion.
- Of that $1 billion, $804 million is insured or financed through the bank.
- The state’s top three export destinations are Mexico, Columbia and Australia.
In an EXIM feature on an Oklahoma Success Story, Tulsa, Okla.-based Sawyer Manufacturing Co. Vice-President Dave Hembree explains the bank’s impact on his firm’s business.
“The ability to extend credit on international sales allows us to grow our business in existing international markets and export our products to new countries by giving our international distributors more flexibility to invest and market our products. Credit terms provided to our international distributors in these markets allow them to better compete, so it makes our U.S. made products more competitive in the international markets. ”
Sawyer Manufacturing Co. also credits these financial assurances for its expanded business in Africa, Russia, Australia and the Middle East and the creation of 10 new jobs.
At the March 24, 2015 OKGIT meeting, group member and F&M Bank’s Randy Kellogg provided his take on the importance of the Export-Import Bank to Oklahoma companies.
“Export-Import helps keep a level playing field for Oklahoma companies on international markets…it doesn’t help finance foreign governments as some critics suggest or only benefit big companies. Its financing helps smaller manufacturers who are indirect exporters when they supply firms like Boeing Company…”