The charter of the Export-Import Bank of the United States is due to expire on September 30, 2014.  Based on recent events, it is unclear whether Congress will act before this date to extend the charter.

The Ex-Im Bank is the official export credit agency of the United States.   Its purpose is to support U.S. jobs, and it accomplishes this goal by facilitating the financing of U.S. goods and services to foreign buyers when private sector lenders will not provide credit on their own.  The Bank does this by offering loan guarantees, direct loans, export-credit insurance, and working capital guarantees to U.S. exporters and foreign buyers.  The Ex-Im Bank’s programs are also aimed at helping U.S. exporters, large and small, compete against foreign exporters who are also provided with government-supported financing by their countries such as China, Russia, Brazil, and India.

In fiscal year 2013, the Ex-Im Bank authorized approximately $6.9 billion in direct loans, $14.9 billion in guarantees, and $5.4 billion in insurance products.

Founded in 1934, the Ex-Im Bank has not been without its critics from both ends of the political spectrum, who have disparaged the Bank as market distorting “corporate welfare.”  Nonetheless, reauthorizing the Export-Import Bank had in the past been relatively non-controversial until the 2012 reauthorization, when soon-to-be-former House Majority Leader Eric Cantor helped negotiate a reauthorization for the Bank that passed the House despite opposition from 93 members.

This time around, however, the Bank’s future is more in doubt.  If the Bank’s authorization is not extended by September 30, the Bank will no longer be able to make loans or offer any of its products.  It will still exist but only to service its existing portfolio.  Whether or not the economy feels an immediate impact on October 1, business leaders expect that a closure of the Bank could be far-reaching, affecting jobs that depend directly or indirectly on exports facilitated by Bank programs.

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of John K. Veroneau John K. Veroneau

John Veroneau is a Chambers-ranked international trade lawyer and co-chairs the firm’s International Trade Practice Group. Having served in senior positions in both Executive and Legislative branches, he provides legal and strategic advice to clients on a broad range of international trade…

John Veroneau is a Chambers-ranked international trade lawyer and co-chairs the firm’s International Trade Practice Group. Having served in senior positions in both Executive and Legislative branches, he provides legal and strategic advice to clients on a broad range of international trade and other public policy matters.

Brendan Parets

Brendan Parets helps organizations resolve their most sensitive problems involving legal, political, and public relations challenges. He deploys his experiences in a Senate leadership office, as the chief legal officer for a presidential campaign, and representing organizations in Department of Justice and administrative…

Brendan Parets helps organizations resolve their most sensitive problems involving legal, political, and public relations challenges. He deploys his experiences in a Senate leadership office, as the chief legal officer for a presidential campaign, and representing organizations in Department of Justice and administrative investigations and in civil litigation to provide holistic advice that reflects business and political imperatives.

Brendan represents corporations and individuals facing congressional and administrative investigations. He also assists organizations with policy matters before Congress and counsels corporations, non-profit entities, and political committees on compliance with federal and state campaign finance laws.

Brendan rejoined Covington after serving as Chief Counsel to Senator Martha McSally (R-AZ), where he oversaw Senator McSally’s work on the Senate Committee on Banking, Housing, and Urban Affairs. Brendan also managed judiciary, commerce, telecommunications, tax, and trade issues for Senator McSally. He worked closely with Senate leadership, committees of jurisdiction, and executive branch agencies to achieve bipartisan compromise on judicial nominations, reform of Department of Homeland Security grant programs, and trade disputes.

He previously served as Chief Counsel to Senator Jon Kyl (R-AZ), Policy Counsel to the Senate Republican Policy Committee, a Senate leadership office chaired at the time by Senator John Barrasso (R-WY), and as Chief Counsel to Senator Lindsey Graham’s presidential campaign.