What future for US Exim under Trump?
The 2017 annual conference of the US Export-Import Bank (US Exim) departed from the tone of previous years: for the first time, the national anthem was sung live to open the event, and acting chairman Charles J Hall’s opening remarks began with a damning comparison of US and China GDP growth and export strategies.
With these displays, the export credit agency (ECA) appeared to “play nice” with the current administration of President Donald Trump, with the hope that he can convince a Republican congress to finally restore US Exim’s full functionality – something his predecessor Barack Obama failed to do in the last year of his presidency.
US Exim has been unable to approve transactions of more than US$10mn for over a year now: in April last year, congress blocked the appointment of the third board member needed to complete its quorum (the body responsible for considering and approving transactions under US Exim rules).
The “presence” (via video message) of Trump’s appointed commerce secretary Wilbur Ross as keynote speaker is a good sign that the government intends to at least try to collaborate with US Exim. But Ross’ remarks were kept to less than five minutes and offered no details on what the administration has in mind, apart from using official export support as “one solution in the toolbox to make trade work for America”.
GTR’s conversations with people who have met with government representatives in the past few weeks revealed that despite an expressed desire to work with the ECA, there are no concrete plans yet on how to get US Exim out of its quorum conundrum.
In one panel, congressman Chris Collins of New York, a Republican who supported US Exim’s latest reauthorisation, said he had been in a meeting with Trump, in which the new president expressed his support for the bank and said he was “all in” to push a vote on the quorum. The bank’s supporters have already submitted a list of board members to the president, but there is still no timeline for the confirmations.
Hall confirmed this to GTR in a filmed interview, pointing out that many members of government have yet to be appointed, and therefore getting US Exim out of its situation is not high on the government’s list of priorities.
Some see the bank’s limited capacity as a positive thing – after all, the bank is being criticised for allocating most of its guarantees to large corporates such as Boeing and Caterpillar. But Hall and many other panellists stressed that such support indirectly helps the thousands of small and medium-sized companies that are part of large corporates’ supply chains.
Most speakers preached to the choir by repeatedly pushing for the restoration of all of the ECA’s export support powers during the conference, but outside of the Omni Shoreham Hotel, a consensus still looks far out of reach, and the plight of US Exim is likely to continue for the foreseeable future.take me back