Trump Administration Supports Preservation of Ex-Im Bank
28 April 2017
President Trump expressed support in mid-April for the preservation of the Export-Import Bank of the United States and announced his intention to nominate former New Jersey Republican congressman Scott Garrett, a former opponent of the Bank, to serve as president of that institution. Trump favoured the elimination of this agency during his presidential campaign but has since changed his mind, highlighting the benefits that the Ex-Im Bank provides to small companies as well as the fact that other countries have similar agencies to support their exports.
The Ex-Im Bank provides trade financing solutions, including export credit insurance, working capital guarantees and guarantees of commercial loans to foreign buyers, aimed at empowering exporters of U.S. goods and services. While this agency has played an important role in supporting U.S. exports over the years and is supported by the main U.S. business associations, a number of lawmakers believe that it unfairly intervenes in free markets and subsidises large companies that are perfectly capable of financing their exports through other means. The long-standing controversy over the future of this institution has undermined its operational capabilities. Specifically, the Ex-Im Bank is currently operating without a quorum and is therefore unable to approve transactions worth more than US$10 million.
In a recent interview, OMB Director Mick Mulvaney indicated that the president wants to put reformers on the Bank “who want to make sure the bank sticks to its knitting and doesn’t experience some of the mission creep that many of our critics have seen.” He added that Trump has authorised him and National Economic Council Director Gary Cohn to begin discussions with other export credit agencies around the globe in an effort to lower the overall level of government interference in the marketplace.
- Finance & Investment
- North America