2010 Competitiveness Report - Export-Import Bank of the United ...

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Decisions on transactions should be based solely on commercial and financial considerations, unless the transaction: fails to comply with Ex-Im Bank’s Environmental Procedures and Guidelines; causes an adverse economic impact on the U.S. economy; or does not meet various statutory and executive branch mandates. All these directives aim to achieve common public policy goals and to reflect the interests of Ex-Im Bank’s diverse stakeholders, such as NGOs (non-governmental organizations), other U.S. government agencies, Labor, financial intermediaries, and exporters. Thus, Ex-Im Bank must constantly find and maintain a balance among its multiple, sometimes competing, goals and objectives. At the same time, Ex-Im Bank is expected to provide the U.S. exporting community with financing that is competitive with officially supported offers made by foreign governments. Given the G-7 ECAs’ widely varying missions and operating strategies, comparing Ex-Im Bank’s competitiveness vis-à-vis ECA counterparts requires a more comprehensive review that goes beyond the simple comparison of the cost aspects of financing programs and policies. Moreover, during the recent financial crisis, one of the most important functions of this report (and other monetary mechanisms) will be to identify whether there are any competitive consequences of amendments made to or the expansion of ECA mandates and the methods used to implement these revisions. 16
Chapter 3: Core Business Policies and Practices Section A: Cover Policy and Risk-Taking Introduction The traditional measure of official ECA competitiveness in cover policy and risk-taking is based on the number of countries in which an ECA provides official export support. Moreover, the breadth of markets and depth of risk appetite within specific countries further determine the competitiveness of an ECA in this area. Hence, ECA competitiveness can be measured based on the number of countries in which it is “open” for business, the nature and level of risk within those markets, on what terms, and its willingness to take on new business with entities other than sovereign governments or first-class private institutions. However, the ability to measure the breadth and depth of ECAs cover policies and risk appetites can be difficult as ECAs use varying reporting techniques and methodologies. Hence, comparable data is often scarce. As a result, the data presented in this chapter is more indicative of overall trends rather than a precise measure of an ECA’s cover policy. Ex-Im Bank’s Policy and Practice Sanctions Historically, Ex-Im Bank has been one of the leading ECAs in terms of the number of countries in which it is open, its overall willingness to take risk in these countries, and its appetite for non-sovereign business. Moreover, the one factor that has typically been a drain on Ex-Im’s competitiveness in this area – the number of countries subject to U.S. sanctions barring Ex-Im Bank support – was multi-lateralized in 2010 for the major target (Iran), thus minimizing the negative competitive implications of this factor. Ex-Im Bank currently has sanctions against providing support to the following countries: Burma, Cuba, Iran, North Korea, Sudan, and Syria. In 2010, the United States Government acted both to multi-lateralize the Iran sanctions and to ensure they were applied consistently through all federal agencies. As a result, the Bank introduced actions to monitor exporter activities related to Iranian buyers. Although all ECAs dramatically reduced activity in Iran, Ex-Im Bank was the only export credit agency to introduce a case-specific questionnaire and processes to ensure that Iran sanctions were applied to officially supported export credits. General Cover Policy and Risk-Taking Outside national policy considerations, Ex-Im cover policy is driven by the economic classification of countries and financial evaluations of non-sovereign borrowers. In 2010, Ex-Im was open for medium and/or long-term cover in a total of 175 countries. Moreover, Ex-Im had a relatively well-balanced portfolio across geographic regions in 2010. The portfolio was spread over Asia/Middle East, the Americas, EU and Africa. Moreover, the overwhelming majority of cases were non-sovereign. 17
Page 1 and 2: Ex p o r t-Im p o r t Ba n k of the
Page 3 and 4: FRED P. HOCHBERG CHAIRMAN AND PRESI
Page 5 and 6: suggests that efforts be made to in
Page 7 and 8: 2011 ADVISORY COMMITTEE MEMBERS The
Page 9 and 10: Definition of Grades Grade Definiti
Page 11 and 12: 2010 COMPETITIVENESS REPORT TABLE O
Page 13 and 14: Executive Summary Background The 20
Page 15 and 16: esponse to such interest, Ex-Im Ban
Page 17 and 18: easonable indication of both the co
Page 19 and 20: co-financing, foreign currency guar
Page 21 and 22: Export Trends Figure 1 illustrates
Page 23 and 24: now on the upswing. These condition
Page 25: Chapter 2: Competitiveness Framewor
Page 29 and 30: Chapter 3: Core Business Policies a
Page 31 and 32: One new product, the Take-Out Optio
Page 33 and 34: Chapter 3: Core Business Policies a
Page 35 and 36: this gap, the OECD members continue
Page 37 and 38: Chapter 4: Major Program Structures
Page 39 and 40: ecord setting pace the commercial a
Page 41 and 42: in the 2007 ASU). In 2010, Ex-Im ap
Page 43 and 44: Conclusion Even with the increased
Page 45 and 46: the awarding of contracts. As in 20
Page 47 and 48: have an adverse impact on Ex-Im’s
Page 49 and 50: With respect to non-aircraft transa
Page 51 and 52: In addition, survey respondents ack
Page 53 and 54: this type of information be disclos
Page 55 and 56: portion of total G-7 ECA activity,
Page 59 and 60: In 2010, Ex-Im Bank supported 12 fo
Page 61 and 62: Conclusion Ex-Im’s strict crystal
Page 63 and 64: During 2008-2010, the majority of E
Page 67 and 68: Figure 16: Aid Credit Volume by Typ
Page 69 and 70: Figure 19: Helsinki-type Tied Aid N
Page 71 and 72: Exporter and Lender Survey and Focu
Page 73 and 74: Window program. Although only three
Page 75 and 76: Conclusion While no specific cases
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Chapter 6: Public Policies - Stakeh
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Figure 25: Transactions Scrutinized
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Figure 26: Comparison of Content Po
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Figure 28: Recent Trends in Ex-Im B
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cargo is ocean-borne. In 2010, Ex-I
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Trends Ex-Im’s Bank overall compe
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Chapter 8: Unregulated and Exceptio
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Since 2006, NEXI’s support throug
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purchase of the goods and services
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Figure 37: Summary of G-7 Investmen
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A. China 1 Of the three countries,
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This program is perhaps the most si
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industry had reached up to 46.3%. O
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BNDES is the government-owned offic
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Organization of “Export China”
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When compared with the OECD Arrange
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foreign buyer due to either/or both
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India Eximbank was established to i
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transactions, while SBCE will provi
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Appendix A: Calculation of Ex-Im Ba
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Appendix B: Purpose of Ex-Im Bank T
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exporters were asked to participate
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Figure C5: Exporter Experience Leve
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Appendix D: G-11 Export Credit Inst
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private participation, instituted i
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Czech Republic Construction Equipme
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Ukraine Mining Equipment $18,838,21
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governed by the Helsinki Discipline
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notifications slightly decreased to
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Energy Generation and Supply ($3.7
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a tied aid and standard credit pers
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The intention of a common line is t
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Appendix F Annex 2 Key Tied Aid Eli
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Appendix F Annex 4 Projects General
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Appendix H: Equal Access for U.S. I
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forums is aimed at helping small bu
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The Bank’s approval of $15 millio
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Appendix K: Legal and Regulatory Re
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The PRA Information Collection Requ
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