2011 508 accessible version - Export-Import Bank of the United States

With respect to interest rates, the year 2011 moved Ex-Im’s interest rate programs int oan absolutely competitive position vis-à-vi s the G-7 (and OECD), receiving an “A+”grade. As spreads increased and commercial bank financing cont racted on pure covertransactions, those E CAs with li mited official financing tools se arched for direct loanmechanisms and liquidity sources to an even greater degree than they did in 2010.While the G-7 ECAs looked to develop such tools in 2011, Ex-Im was at a distinctadvantage due to its existing direct loan program.With respect to project financ e, the financing and c apacity advantages associated withEx-Im Bank’s project finance cover appear to have outweighed the non-financial andlong-standing disadvantages associated with Ex-Im Bank foreign content, MARAD andeconomic impact policies that typically take the center stage in the Bank’scompetitiveness assessment and weigh down Ex-Im Bank’s grade point a verage. Thisedge was significant enough to induce a shift in sourcing in certain cases. A s a result, in2011, Ex-Im Bank earned an “A+” in the area of project finance.Moreover, exporter and lender input impacted two programmatic components of Ex-ImBank grades. Specifically, the grade for Ex-Im Bank Services support worsened while themarks for Ex-Im Bank’s Environmental Policies improved.With respect to the Services policy, Ex-Im Ba nk’s available support for services appea rsto be lacking competitiveness relative to ot her G-7 ECAs’ services policies. Informationfrom buyers, exporters, and lenders on compe titor practices related to services suggeststhat Ex-Im Bank’s wi llingness to support serv ices is impacted by how it applies itscontent policy to services. The main di fference between Ex-Im Bank and competitorECAs is that Ex-Im Bank evaluates the el igibility of the U.S. export (and thecorresponding benefit to U.S. employment), while so me foreign ECAs support theirnational exporters without further document ation requirements. This resulted in adowngrade in Bank competitiveness when com pared to last year or a grade of “B ” for2011, down from the “A-/B+” earned in 2010With respect to Ex-Im Bank’s Environmental Policies, Ex-Im Bank continued to garneran “A” in the area of environmental guidelines (because Ex-Im applies theenvironmental guidelines that all OECD ECAs apply, known as the CommonApproaches); and “B” in the ar ea of transp arency (because Ex- Im continues to haveincreased transparency requirements relative to foreign ECAs, especi ally as they applyto the disclosure of project monitoring reports). However, although no other OECD ECAadopted a Carbon Policy in 2011, render ing Ex-Im as relatively less competitiv ecompared to other OECD ECAs, exporter and lender feedback on the Carbon Policy wasnot as negative as the commentary provided for the 2010 assessment. Therefore, theCarbon Policy grade improved from a “C” in 2010 to a “B-/C+” rating for 2011. Tak ingall three of these grades into account, th e overall rating for Ex-Im’s environmentalguidelines and carbon policy was “B” in 2011.Finally, Chapter 8 will examines the findin gs of the benchmarking study that wasconducted to gauge the size, scope and impact of other forms of official finan cing thatfall outside the purview of the OECD.The benchmarking study brought into focus many important issues, of note:4