 | |
| Agency overview | |
|---|---|
| Formed | February 2, 1934; 91 years ago (1934-02-02) |
| Headquarters | Lafayette Building Washington, D.C. |
| Employees | 370 (2018) |
| Agency executive |
|
| Website | exim.gov |
TheExport–Import Bank of the United States (EXIM) is the officialexport credit agency (ECA) of theUnited States federal government.[1][2] Operating as a wholly owned federalgovernment corporation,[1] the bank "assists in financing and facilitating U.S.exports of goods and services",[1] particularly when private sector lenders are unable or unwilling to provide financing. Its current chairman and president, John Jovanovic took office as chair and president on September 19, 2025.[3][4]
The Export–Import Bank was established in 1934 as theExport-Import Bank of Washington by anexecutive order of PresidentFranklin D. Roosevelt. Its stated goal was "to aid in financing and to facilitate exports and imports and the exchange of commodities between the United States and other Nations or the agencies or nationals thereof." The bank's first transaction was a $3.8 million loan to Cuba in 1935 for the purchase of U.S. silver ingots. In 1945, it was made anindependent agency within theexecutive branch by theUnited States Congress.
Under federal law, the EXIM must be reauthorized by Congress every four to five years.[5] Following a brief lapse in Congressional authorization on July 1, 2015,[6][7] which prevented the bank from engaging in new business,[8] it was reauthorized through September 2019 via theFixing America's Surface Transportation Act of December 2015.[9] In December 2019, President Donald Trump signed the Export-Import Bank Extension into law as part of the Further Consolidated Appropriations Act, 2020, which authorized the bank until December 31, 2026.[10]
Over its lifetime, the Export-Import Bank has helped finance several historic projects including thePan-American Highway, theBurma Road, and post-World War II reconstruction. While supporters argue that the bank allows small and medium-sized businesses to participate in the global market, critics allege that it shows favoritism to large corporations and special interests.
The Export–Import Bank of the United States (EXIM) is a government agency that provides a variety of tools intended to aid the export of American goods and services. The mission of the Bank is to create and sustain U.S. jobs by financing sales of U.S. exports to international buyers. EXIM equips U.S. exporters and their customers with tools such as buyer financing, export credit insurance, and access to working capital. Second, when U.S. exporters face foreign competition backed by other governments, EXIM provides buyer financing to match or counter the financing offered by almost 96 ECAs around the world. The Bank is chartered as a government corporation by the Congress of the United States; it was last chartered for a three-year term in 2012. The Charter details the Bank's authorities and limitations. Among them is the principle that EXIM does not compete with private sector lenders, but rather provides financing for transactions that would otherwise not occur because commercial lenders are either unable or unwilling to accept the political or commercial risk inherent in the deal.[11][12]
The EXIM's products are intended to assist export sales for any American export company regardless of size. The bank's charter provides that EXIM makes available "not less than 20%" of its lending authority to small businesses although they have often fallen short of the 20% threshold.[13][14] In fiscal year 2013 however, 76% of the value of loans and guarantees went to the top 10 recipients.[15]
Similar banks, known generally asexport credit agencies (ECAs), are operated by 60 foreign countries.[16] As the United States is a member of theOrganisation for Economic Co-operation and Development (OECD) they conduct their activities by obeying OECD rules and principles. The goal is to permit exporters in various countries to compete on the basis of the quality of their goods and services, not on preferential financing terms. ECAs of countries which are not participants of the OECD, such as theChina Exim Bank are not required by their governments to follow OECD rules.[17]
The Board of Directors consists of the President of the Export-Import Bank, who also serves as Chairman, the First Vice President, who serves as Vice Chairman, and three additional Directors appointed by the President of the United States by and with the advice and consent of the Senate. Of these five members of the Board, no more than three can be members of any one political party. In addition, at least one of the members must be selected from among the small business community. The members are appointed to staggered terms of four years. They can continue to serve on the board past the expiration of their term until their successor takes office, but not beyond six months after the expiration of their term.[18]
The United States Trade Representative and the Secretary of Commerce shall serve, ex officio and without vote, as additional members of the Board of Directors of the Bank.[18]
The current board members as of February 24, 2025[update]:[19]
| Name | Position | Party | Took office | Term expiration |
|---|---|---|---|---|
| John Jovanovic | President and Chair | style="color:black; background-color:#FFB6B6" | September 19, 2025 | — |
| James G. Burrows, Jr. | Vice President and Vice Chair | N/A | February 28, 2025 | — |
| Spencer Bachus | Member | Republican | May 8, 2019 | January 20, 2027 |
| Vacant | Member | — | — | January 20, 2027 |
| Vacant | Member | — | — | January 20, 2029 |
| Howard Lutnick | Secretary of Commerce ex officio (non-voting) | Republican | February 21, 2025 | — |
| Jamieson Greer | U.S. Trade Representative ex officio (non-voting) | Republican | February 26, 2025 | — |
List of EXIM chairmen and presidents |
|---|
|
EXIM was organized originally as aDistrict of Columbia banking corporation byExecutive Order 6581Archived April 20, 2023, at theWayback Machine fromFranklin D. Roosevelt on February 2, 1934, under the nameExport–Import Bank of Washington. The stated goal was "to aid in financing and to facilitate exports and imports and the exchange of commodities between the United States and other Nations or the agencies or nationals thereof", with the immediate goal of making loans to theUSSR and Latin America. Roosevelt created a Second Export–Import Bank of Washington with Executive Order 6638 on March 9, 1934, with the specific goal of aiding trade with Cuba.[22] The Bank's first transaction was a $3.8 million loan toCuba in 1935 for the purchase of U.S.silveringots.[23] The First and Second Export–Import Banks were combined in 1936 when Congress transferred the obligations of the Second Export–Import Bank to the first.[24]
Congress made the bank an independent agency on July 31, 1945, with the Export–Import Bank Act of 1945.[25] On March 13, 1968, further legislation changed the name to "Export–Import Bank of the United States".[26][27] EXIM became a self-sustaining (self-funding) agency in 2007, though the loans remain backed by the government.[28]
The Government Corporation Control Act of 1945 requires the Bank to be reauthorized by Congress every four to five years.[5] Reauthorizations have been approved several times:
| Bill name | Date signed into law | Bank authorized until |
|---|---|---|
| S. 3938 | December 20, 2006 | May 30, 2012[29] |
| H.R. 2072 | May 30, 2012[29] | September 30, 2014[29] |
| H.J.Res. 124 | September 19, 2014[30][31] | June 30, 2015[30] |
| H.R. 22 | December 4, 2015[32] | September 30, 2019[33] |
| H.R. 1865 | December 20, 2019[34][35] | December 31, 2026[36] |
It was last chartered for a three-year term in 2012 and in September 2014 was extended through June 30, 2015. Congressional authorization for the bank lapsed as of July 1, 2015.[6][7] As a result, the bank could not engage in new business, but it continued to manage its existing loan portfolio.[8] Five months later, after the successful employment of the rarely useddischarge petition procedure in theHouse of Representatives, Congress reauthorized the bank until September 2019 via theFixing America's Surface Transportation Act signed into law on December 4, 2015, by PresidentBarack Obama.[9] In December 2019, President Donald Trump signed the Export-Import Bank Extension into law as part of the Further Consolidated Appropriations Act, 2020 (P.L. 116–94) which authorized the bank until December 31, 2026.[10]
EXIM institution the China and Transformational Exports program in an effort to assist American exporters in competing with Chinese companies and to maintain American advantages in specified industries.[37]
ThePan-American Highway runs from Alaska to Chile through 14 countries with important transportation links to nearly all of continental Latin America. The highway was constructed beginning in 1936 with the last phase complete in 1980.[38]
EXIM Bank credits and loans supported construction of the Pan-American Highway in Mexico, Honduras, Guatemala, Nicaragua, El Salvador, Costa Rica, Panama, Colombia, Ecuador, Peru and Chile.[39] In Paraguay, Argentina, and Bolivia EXIM supported construction of highway spurs connected to the Pan-American Highway.[40] EXIM approved twenty credits to U.S. companies including Caterpillar, Koehring Co., Allis-Chalmers Manufacturing, The Galion Iron Works, andThew Shovel to help build the highway.[40]
Constructed between 1937 and 1938, the 717-mileBurma Road links Lashio in present-day Myanmar (previously Burma) to Kunming in Yunnan Province, China.[41]
The $25 million credit approved by EXIM in December 1938 was crucial in ensuring that the supply route remained open by providing the transportation vehicles and support material to operate the new road and by providing China with purchasing power during WWII. An additional $20 million to the Universal Trading Corporation was approved in 1940.[42] A 1939 journal article in Foreign Affairs noted that China used part of the $25 million to purchase 2,000 three-ton trucks from Ford, Chrysler, and General Motors.[43]
EXIM played a critical role during the years between the end ofLend-Lease (September 1945) and the beginning of theMarshall Plan and the World Bank's first authorizations (May 1947 – 1948). At the end of WWII, it was recognized that the U.S. did not have a credit facility capable of handling the demand that would result from the cessation of hostilities. One of the major rationales behind the Export–Import Bank Act of 1945, the basis of EXIM's current charter document, was the necessity to dramatically increase EXIM's lending capacity to adequately respond to Europe's post-war reconstruction needs. The 1945 EXIM Annual Report predicated EXIM's role in the immediate post-WWII period: "the Export–Import Bank was to be the principal source of long-term dollar loans for an extended period of time." This assertion was based on the lack of interest by private capital in lending to foreign government buyers and delays in ratification of the Articles of Agreement for the International Monetary Fund and the International Bank for Reconstruction and Development.[44] The Export–Import Bank Act of 1945 increased lending authority from $750 million to $3.5 billion, almost a fourfold increase to help address these shortfalls.[45]
In 1945 and 1946 credit was offered to France, Denmark, Norway, Belgium, the Netherlands, Turkey, Czechoslovakia, Finland, Italy, Ethiopia, Greece, Poland and Austria to purchase equipment, facilities, and services from the United States. The financing was designed to aid reconstruction of the nations and to repair their import and export capability through the purchase of new machinery, currency exchange, and improvements and repairs to infrastructure and transportation systems.[46]
When the Marshall Plan was initiated in 1948, EXIM concentrated its lending on non-Economic Recovery Act nations in North and South America.[47]
When the Berlin Wall fell in 1989 and the USSR was dissolved in 1991, U.S. companies were able to conduct business freely with Eastern Europe for the first time since the end of WWII. EXIM was one of the first financial institutions to provide financing for exports to the former Soviet Union, Poland, Czechoslovakia and the newly independent nations that emerged after 1991. In 1990, President George H.W. Bush waived theJackson–Vanik amendment, which had officially blocked normal trade relations with communist countries since 1975. This waiver permitted all E guarantee and insurance programs to U.S. companies wanting to do business with the USSR and several former communist countries.[48]
EXIM resumed business with Czechoslovakia in March 1990. On January 25, 1991, EXIM approved the first transaction to Czechoslovakia since 1947. Financed by First Interstate Bank of Los Angeles, CA, the guarantee allowed Tonak Hat Company[49] to purchase computers from a U.S. company,Digital Equipment Corporation of Massachusetts. Since 1991, EXIM has supported exports to 25 of the nations that emerged after the fall of the Iron Curtain.[50]
After a visit to India in January 2015, President Obama announced that the EXIM will finance $1 billion of exports of 'Made-in-America' products, the U.S.Overseas Private Investment Corporation will lend $1 billion to small- and medium-sized rural enterprises and the U.S.Trade and Development Agency will commit $2 billion for renewable energy. Obama and Modi agreed on issues that had previously stopped U.S. companies from establishing nuclear reactors in India.[51]
Supporters say that the bank emphasizes trying to help small and medium size businesses expand their exporting capabilities. CEO and president of theNational Association of ManufacturersJay Timmons stated: "The EXIM plays a critical role in manufacturer's ability to export to new markets and keep up with growing global competition. The Bank assists nearly 290,000 export related jobs and each year is helping more and more small and medium-sized manufacturers grow their businesses and hire new workers. More than 85% of all EXIM transactions directly benefit small business exporters—the economic engine that powers our economy and job creation."[52]
When Obama was campaigning for president in 2008, he stated that the Export–Import Bank had "become little more than a fund forcorporate welfare."[53] During the Bank's reauthorization struggle, May 2012, he said that the Export–Import Bank plays a very important role in reaching his goal of doubling exports over 5 years. At the reauthorization ceremony Obama stated: "We're helping thousands of businesses sell more of their products and services overseas, in the process, we're helping them create jobs here at home. And we're doing it at no extra cost to the taxpayer."[54]
The Bank has been criticized for favoring special interests. These interests have included corporations such asBoeing orEnron as well as foreign governments and nationals, such as a 1996 $120 million low-interest loan to theChina National Nuclear Power Corporation (CNNP) supporting the export of US-made technology.[55]
More recently the bank authorized $33.6 million in loans to Abengoa, a Spanish Green energy company on which former GovernorBill Richardson is a member of the board of directors. As of May 2014, Richardson was also listed as a member of the advisory committee of the Export–Import Bank.[56]
65% of loan guarantees over 2007 and 2008 went to companies purchasingBoeing aircraft.[57] In 2012, the Bank's loan guarantees became even more skewed, with 82 percent of them going to Boeing customers.[58]
However, EXIM supporters note that Boeing is the largest exporter in the United States by dollar value,[59] and must be protected in their capacity as the only remaining comprehensive U.S. commercial aircraft manufacturer. Support of Boeing is seen as particularly critical asComac, China's state-owned and heavily subsidized commercial aircraft manufacturer, aggressively seeks to leech market share from both Boeing and Airbus. Also important to note, Boeing is not the only US aircraft manufacturer previously supported by EXIM. During the 1930s, 40s, and 50s, EXIM supported other US aviation manufacturers such as theDouglas Aircraft Company, theConsolidated Vultee Aircraft Company (Convair), and theLockheed Aircraft Corporation.[60]
The cost and effectiveness of the bank are controversial. While the EXIM projects will earn the U.S. government an average of $1.4 billion per year for the next 10 years, an alternative analysis from theCongressional Budget Office found that the program would lose about $2 billion during the same period, partly due to discrepancies in how credit risk is accounted for. Both conservative and liberal groups have been critical of the bank, and some continue to demand its termination.[citation needed]
Critics also purport the existence of "unseen" costs created by the Export–Import Bank's subsidies, including artificially raising the price of new airplanes and potentially adding $2 billion to the deficit over the next decade.[61]
Forbes contributorDoug Bandow wrote in 2014, "The agency piously claims not to provide subsidies since it charges fees and interest, but it exists only to offer business a better credit deal than is available in the marketplace. The Bank uses its ability to borrow at government rates to provide loans, loan guarantees, working capital guarantees, and loan insurance."[62]
If the normal principles of economics or finance are applied, then it is seen by critics as unlikely that the bank has profited and most unlikely that it makes the annual profit that it has stated, because the bank's calculations of profit fail to make proper adjustment for risk.[63][64][65][66][67][68] Best practice in finance and economics, as well as in banking, is to adjust thecost of capital or discount rate to reflect risk,[69] or, equivalently, to use a fair-value estimate. On this basis the criticism is that "This simple approach—which is based on a method outlined in aNational Bureau of Economic Research paper by Debbie Lucas of theMassachusetts Institute of Technology—suggests that the EXIM's long-term loan guarantee program actually provides guarantees at a loss for taxpayers, not a profit. Moreover, this analysis reveals that the EXIM's loan guarantees are made at sufficiently generous terms that borrowers receive subsidies of about 1% of the amount borrowed. That translates into a $200 million cost for taxpayers on the $21 billion in loans that the bank will make in 2012."[70]
In February 2009, the EXIM settled a seven-year-long legal proceeding brought byFriends of the Earth,Greenpeace together with the cities ofBoulder,Arcata andOakland. The plaintiffs said that the EXIM and theOverseas Private Investment Corporation provided financial assistance to oil and otherfossil fuel projects without first evaluating the projects'climate change impacts.[71] In 2005, the plaintiffs were granted legal standing to sue. This is considered a landmark decision because it is the first time that a federal court has specifically granted legal standing for a lawsuit exclusively challenging the federal government's failure to evaluate the impacts of its actions on the Earth's climate and U.S. citizens.[72] In its settlement agreement, the EXIM agrees to evaluate the carbon dioxide emissions as part of its determination for qualification for a project.[73][74][75] However, EXIM fossil fuel financing and associatedgreenhouse gas emissions grew swiftly after the settlement agreement, coinciding with Chairman Hochberg's tenure. Between 2009 and 2012, EXIM fossil fuel financing grew from $2.56 billion to nearly $10 billion.[76][77]
Environmental groups in 2010 said that the EXIM was on a "fossil fuel binge", which "makes a mockery" of President Obama's stated commitment to phase outfossil fuel subsidies.[78][79] In December 2009, EXIM Directors approved $3 billion in financing for theExxonMobil-ledPapua New Guinea Liquid Gas project in December 2009.[80] The project has reportedly caused violence and in April 2012, thePapua New Guinea government ordered in troops to quell opposition from villagers after a landslide linked to a quarry that had been used by the project killed an estimated 25 people.[81][82]
In 2010, environmental groups criticized the EXIM Directors for approving $917 million worth of financing for the 3,960 megawatt coal-firedSasan Ultra Mega Power Project in India after initially rejecting the project on climate change grounds. Environmental groups say that in reversing the decision the agency's Chairman, Fred Hochberg and Board of Directors "caved in" to political pressure from Wisconsin politicians.[83][84][85][86][87] In 2011, several environmental groups protested at Export–Import Bank headquarters, unsuccessfully urging Chairman Hochberg and Board of Directors to reject $805 million in financing for the 4,800 megawatt Kusile coal-fired power plant inSouth Africa,[88] which environmental groups say is the largest carbon emitting project in the agency's history, which will not alleviate poverty but will emit excessive local air pollution, which health experts say causes damage the respiratory, cardiovascular, and nervous systems and deaths resulting from heart disease, cancer, stroke, and chronic lower respiratory diseases.[89][90][91][92] EXIM's 2011 announcement of support for Kusile asserted claims of environmental advancements including that "Kusile will be the first coal-fired power plant in South Africa to includesulfur dioxide scrubbers."[93] However, in 2023 the South African energy utility Eskom proposed to circumvent the Kusile sulfur dioxide pollution control system, which the Helsinki-based Centre for Research on Energy and Clean Air estimates could result in 680 deaths.[94]
In December 2012, theCenter for Biological Diversity,Pacific Environment, andTurtle Island Restoration Network filed a lawsuit against Chairman Hochberg and the EXIM for the agency's financing ofAustralia Pacific LNG's liquid natural gas projects inside theGreat Barrier Reef World Heritage Area. The lawsuit alleged that EXIM financing for the projects violates U.S. environmental and cultural heritage laws.[95] Their amended lawsuit included EXIM's loan for the Australia Pacific LNG project and a $1.8 billion loan for the Queensland Curtis which together totaled $4.8 billion. In March 2016, a California federal judge ruled against the environmentalists arguing that the EXIM financing represented only 10% of the project which is backed byConocoPhillips,Origin Energy Ltd. andSinopec and rejecting the loan would not stop the project. The environmentalists appealed the decision.[96]
In 2019Friends of the Earth (US) criticized EXIM PresidentKimberly A Reed for supporting the liquid natural gas (LNG) industry despite the lifecycle climate impacts of the fossil fuel, citing the U.S. government'sFourth National Climate Assessment finding that more frequent and extreme weather events are severely damaging the environment and the economy, while increasing harm to human health and loss of life. Friends of the Earth (US) also criticized EXIM for approving $5 billion in financing the Mozambique LNG project, citing the project's damage to the surrounding ecosystem (including to endangered species), displacement of local communities, and lack of economic benefits for local people.[97][98]
In May, 2023 EXIM Chair Reta Jo Lewis, Vice Chair Judith Pryor and Director Spencer Bachus voted to approve nearly $100 million in Export-Import Bank financing for an oil refinery expansion project in Indonesia (EXIM Director Owen Herrnstadt abstained).[39] Environmental groups criticize the approval as directly violating President Biden's commitments to end overseas fossil fuel financing, including at the 2021 UN Climate Change Conference.[40] The approval was also repudiated by the White House National Security Council, which stated the "decision does not reflect administration policy."[42]
Conversely the EXIM has also faced scrutiny for pursuinggreen energy projects. The EXIM provided $10 million of loan guarantees in 2011 toSolyndra, a company that ultimately became bankrupt.[99]
{{cite book}}: CS1 maint: publisher location (link)