Infrastructure

By 2030, five billion people — almost two-thirds of the global population — could be living in the middle class. (Source: The Brookings Institution) Development of infrastructure of all types is needed to meet the demands and expectations of consumers in emerging markets.

International infrastructure development presents tremendous opportunities for American companies in a wide variety of industries – from construction equipment to power generation to telecommunications and beyond – to grow through exporting.

Ex-Im Bank is focused on supporting U.S. exporters in winning the contracts to supply international infrastructure needs across the globe but especially in the nine key country markets where the Bank has focused its efforts.

Consistent with World Bank and OECD definitions, infrastructure is defined by Ex-Im Bank to include the large physical networks necessary for the functioning of commerce (e.g., highways, railroads, power-generation plants, pipelines, satellites and radio-transmission systems), as well as goods and services required to maintain the health, cultural and social standards of a country or state (e.g., educational and healthcare equipment and services). Also included in the Bank’s definition of infrastructure are transportation vehicles, such as aircraft and locomotives, and equipment and services related to mining industries. (See accompanying table.)

Ex-Im Bank Infrastructure Authorizations

(in millions)
	FY 2011		FY 2010
Infrastructure	Infrastructure Auth.	Percentage of Total Auth.	Infrastructure Auth.	Percentage of Total Auth.
Traditional*
Hard Infrastructure	$8,179	25.0%	$1,637	6.7%
Soft Infrastructure	300	0.9%	414	1.7%
Subtotal	8,480	25.9%	2,050	8.4%
Other
Aircraft	12,614	38.5%	7,414	30.3%
Mining	1,407	4.3%	5,293	21.6%
Locomotives	545	1.7%	10	0.0%
Subtotal	14,566	44.5%	12,717	52.0%
TOTAL	$23,045	70.4%	$14,767	60.4%

* Consistent with World Bank and OECD definitions, infrastructure is defined by Ex-Im Bank to include the large physical networks necessary for the functioning of commerce (e.g., highways, railroads, power-generation plants, pipelines, satellites and radio-transmission systems), as well as goods and services required to maintain the health, cultural and social standards of a country or state (e.g., educational and healthcare equipment and services). Also included in the Bank’s definition of infrastructure are transportation vehicles, such as aircraft and locomotives, and equipment and services related to mining industries.

In FY 2011, Ex-Im Bank

• Authorized a historic high of $23 billion to support U.S. exports to infrastructure projects, including mining projects and large transportation equipment. This financing represents more than 70 percent of the Bank’s total authorizations in FY 2011. It is also a 56 percent increase over the Bank’s infrastructure financing in FY 2010.

• Approved $8.6 billion for long-term structured and project finance transactions for projects including oil and gas development and energy production – a 25 percent increase over FY 2010’s record high of nearly $6.8 billion.

• Approved more than $12.6 billion in financing to support the export of U.S.-made aircraft of all types, including $10.8 billion in support of large commercial aircraft to a total of 21 countries, including first-time support for aircraft exports to Rwanda and Tajikistan.

• Supported U.S. locomotive exports to South Africa and Kazakhstan through authorizations totaling $545 million.

• Authorized $1.3 billion to finance exports of U.S.-manufactured communications satellites. (See below.)

Ex-Im Support for U.S. Satellite Exports Photo courtesy of GE Transportation Ex-Im Bank export financing for communications satellites increased significantly in FY 2011. Historically the Bank has done very few satellite transactions, averaging approximately $50 million per year over the 15-year period prior to 2010. In FY 2010, the Bank’s financing increased to $400 million. In FY 2011 – in response to soaring demand – Ex-Im Bank authorized more than $1.3 billion in communications-satellite financing for U.S. manufacturers.  Among the satellite transactions authorized in FY 2011: Orbital Sciences Corp. of Dulles, Va., sold the Azerspace/Africasat-1a Satellite to Azerbaijan. Ex-Im Bank provided $117 million in export financing. Boeing Space and Intelligence Systems in El Segundo, Calif., sold satellites to Inmarsat, a global provider of mobile satellite communications services to the maritime industry. The Bank provided Inmarsat with a $700 million direct loan to support the purchase. Space Systems/Loral (SS/L) of Palo Alto, Calif.,  exported a Ku-band broadcast satellite to SES S.A. of Chateau de Betzdorf in Luxembourg. The Bank provided a $172 million direct loan, which will also cover launch insurance from AON Corp. of Chicago, Ill. Space Systems/Loral (SS/L) of Palo Alto, Calif. , exported the Amazonas-3 satellite to Hispasat Canarias, S.L.U, of Madrid, Spain. The export was supported by the Bank’s $228 million guarantee of a loan made by JPMorgan Chase Bank of New York. This transaction marks the second year in a row in which Ex-Im Bank supported a Hispasat purchase from Loral. Based on jobs numbers supplied by the satellite exporters, Ex-Im Bank estimates that its financing supported the creation or maintenance of approximately 4,000 jobs at the exporters’ facilities and those of their suppliers.