Exporting RoundupDecember 20, 2011
2011 has been a very busy year in the world of exporting. Two key issues have been at the forefront of NSBA and SBEA’s efforts: reauthorizing the Export-Import Bank of the U.S. (Ex-Im Bank) to include strong small-business language and enactment of three Free Trade Agreements (FTAs). Additionally, Ex-Im Bank just recently released their 2011 annual report showing record-breaking financing and announced the members of their 2012 Advisory Committee, nearly half of whom are small-business owners. Rounding the year out, new data is available that shows slight decreases in U.S. exports for the month of October, yet significant lending support from the SBA Office of International Trade (OIT).
When the charter authorizing Ex-Im Bank expired on Sept. 30, lawmakers approved a temporary extension for the program to operate as-is through Dec. 16. During those months, SBEA worked tirelessly toward a more long-term reauthorization and an increase in its lending cap. It had appeared a deal was brokered that would have reauthorized Ex-Im Bank for four years and increase its lending authority from $100 billion to $135 billion.
Unfortunately, there was a small handful of lawmakers who pushed against this widely-supported compromise and instead supported a very short-term—6 month extension—with no increase in the credit levels. This compromise was eventually included in the Omnibus Appropriations bill for Fiscal Year 2012, which was approved just last week.
SBEA will now focus its efforts on the months ahead and work toward ensuring a thriving, small-business friendly Ex-Im Bank for years to come.
Please click here for more on Ex-Im reauthorization.
Free Trade Agreements Signed
On Oct. 21, President Barack Obama signed the three FTAs between the U.S. and South Korea, Colombia and Panama. The deals were first negotiated during the George W. Bush administration and were revised by the Obama administration. The agreements are expected to boost U.S. exports by around $13 billion annually, which the administration estimates will create or maintain about 70,000 jobs.
The key hurdle to passing the three FTAs was renewal of the Trade Adjustment Assistance (TAA) that helps workers who have been hurt by increased global competition. The TAA renewal was enacted alongside the FTAs.
The signing culminated a burst of bipartisanship, as congressional Republicans supplied the majority of the votes earlier in the month to get the long-stalled agreements to the president. Many Democrats had been far more skeptical of the trade pacts. In order to get more Democrats on board with the three deals: South Korea agreed to new terms that would give U.S. exporters more access to their auto and beef markets; Columbia agreed to work to satisfy complaints about its labor environment and Panama agreed to new financial regulations and transparency.
U.S. officials have said the deals—the biggest since the North American Free Trade Agreement in 1993—will reduce prices for American consumers and increase foreign sales of U.S. goods and services, providing a much-needed jolt to the sluggish U.S. economy.
Please click here for more on the FTAs.
Ex-Im Announces Annual Report and Advisory Committee
In the last week, the Export-Import Bank of the U.S. (Ex-Im Bank) released its 2011 Annual Report which provides a comprehensive analysis of Ex-Im Bank’s export financing in FY 2011, which showed that, for the third-straight year, Ex-Im Bank set export finance records including overall financing that exceeded $32 billion. Additionally, Ex-Im Bank announced its 2012 Advisory Committee members who are charged with helping Ex-Im Bank review policies and programs by providing input from various sectors of the U.S. economy. Nearly half of the Committee’s members are small-business owners.
The U.S. Department of Commerce’s Census Bureau and the Bureau of Economic Analysis (BEA) announced that total October exports of $179.2 billion and imports of $222.6 billion resulted in a goods and services deficit of $43.5 billion, up from $44.2 billion in September. October exports were $1.5 billion less than September exports of $180.6 billion. October imports were $2.2 billion less than September imports of $224.8 billion.
For the three months ending in October, exports of goods and services averaged $179.3 billion, while imports of goods and services averaged $223.6 billion, resulting in an average trade deficit of $44.3 billion. For the three months ending in September, the average trade deficit was $45.2 billion, reflecting average exports of $178.8 billion and average imports of $224.0 billion.
Please click here for more details from BEA.
SBA Office of International Trade Data
The U.S. Small Business Administration Office of International Trade (OIT) recently released numbers for FY 2011, which underscored their very successful year helping to strengthen small business ownership and the economy, both here in the U.S. and globally.
The number of OIT export working capital loans increased 14.8 percent from 149 (counting Export-Import Bank co-guarantees) to 171 from FY2010 to FY2011. International trade loans were up 440 percent from 5 to 27 and export express increased from 239 to 287, a 20.1 percent rise. Three core export loan programs rose 23.4 percent collectively from 393 to 485 and all SBA loans to exporters were $918 million up 41 percent from FY2010. This lending supported $1.8 billion in exports.
For more information on how SBA can help with a new international venture, visit http://www.sba.gov.