Exports Help Midwestern Firms Create and Sustain U.S. Jobs During Economic Crunch
FOR IMMEDIATE RELEASE January 20, 2009
Marianna Ohe (202-565-3200)
WASHINGTON, D.C. - While many U.S. companies are being forced to lay off workers, lots of small businesses are maintaining and adding jobs with the help of the Export-Import Bank of the United States (Ex-Im Bank). From the sale of animal feed processing equipment to Honduras, to the export of label and packaging industry printers to Brazil, U.S. small businesses located far from U.S. coasts are making inroads in distant markets, backed by Ex-Im Bank financing.
For the past two years, we've gone from about 20 employees to 50 employees while working with Ex-Im Bank on a number of transactions, and we're still hiring, said Joseph W. Barbi, president and owner of Engineered Systems and Equipment, Inc. (E.S.E.) of Caney, Kan.. E.S.E. makes feed processing equipment and provides engineering services and is a long-time Ex-Im Bank customer. Our staff works 50-60 hours a week, overtime with no stop! Barbi said.
Most recently, a PNC Bank N.A. loan, backed by an Ex-Im Bank medium-term (five-year) insurance policy, supported E.S.E.'s $500,000 sale of specialized feed pelleting and extrusion systems and engineering services to Productos, Tecnologia y Nutricion animal, S.A. de C.V. (Proteina). A maker of animal feed for cattle, poultry, pigs and fish, located in San Pedro Sula, Honduras, Proteina will use the equipment to expand and upgrade its production capacity.
Ex-Im Bank insurance protects exporters and lenders against buyer non-payment and enables U.S. companies to offer foreign buyers competitive financing.
Because of Ex-Im Bank, we've been able to expand our export markets considerably, with export deals totaling more than $7 million in the past couple of years, said Barbi. We used to be in a situation, especially in Mexico and Central America, where European competition and financing put us out of the market. But in the last couple of years, in every single project we've done with Ex-Im Bank where we've been in competition with European companies, we have won it!
We were very pleased to have been referred by Mr. Barbi to Proteina, which needed attractive financing to make an investment in E.S.E.'s equipment financially viable, said Alan Andrews, PNC Bank's vice president, Global Trade and Equipment Finance Group.
Mark Andy Inc. of Chesterfield, Mo., has sold more than $1 million of specialized printing equipment for the labeling, flexible packaging and folding carton industries to three different buyers in Brazil in the past six months, backed by Ex-Im Bank medium-term insurance.
Most recently the 450-employee company sold a Model 2200-10 converting system to Covasa Importacao Exportacao Comercio e Representacal de Etiquetas, Ltda (Covasa) in Sao Paulo, Brazil to expand current production; the other two recent Brazilian buyers were Maxcor Industria de Etiquetas Ltda., and Etiquetas Brazil Industria Grafica Ltda.
Buyers are finding it increasingly difficult to find financing, so Ex-Im Bank is becoming more and more critical to them in getting the financing they need to buy our U.S.-made products, said Jeff Auton, Mark Andy manager of trade finance. We're making every effort to sustain jobs during the difficult, tumultuous times that we're facing worldwide. Programs like Ex-Im Bank help fill production slots at our plants in Chesterfield and Cincinnati, Ohio.
More than half of Mark Andy's sales are exports.
International Division, Inc. (INDIV), a 12-employee company in Springfield, Mo., is selling poultry-raising equipment to Las Camelias S.A. of San Jose, Argentina, backed by a $4.68 million loan from Toronto Dominian Bank covered by Ex-Im Bank medium-term insurance. Las Camelias will use the watering, feed and ventilation equipment to expand operations.
Through the years we've worked with Ex-Im Bank's medium-term insurance program for projects in Central and South America, the Caribbean and Mexico, said INDIV President Jose Sala. This program is a good tool not only for us but for our customers; they are able to source U.S. goods with financing at interest rates which are normally very favorable compared to those they may pay in their own country, if they could get financing at home at all! The Ex-Im Bank program also lets foreign buyers package their growth plan into one transaction, buying all the needed equipment in one deal instead of spreading it out over time. This allows them to grow more quickly, and have a longer period of time to pay for it.
Sala said the Ex-Im Bank transactions have a trickle-down effect on its U.S. suppliers. We secure the order, then give the order to our suppliers. This helps keep U.S. manufacturing going, helps INDIV and its manufacturers sustain jobs.
INDIV's suppliers include Ziggity Systems, Inc., Middlebury, Ind., a small-business manufacturer of watering systems, as well as makers of grain bins and poultry equipment.
In fiscal year 2008 Ex-Im Bank authorized $3.2 billion - more than 23 percent of total authorizations - in direct support of U.S. small businesses as primary exporters. The Bank approved 2,328 transactions that were made available for the direct benefit of small-business exporters. These transactions represented 86 percent of the total number of authorizations approved.
Ex-Im Bank is the official export-credit agency of the United States. The independent, self-sustaining federal agency, now in its 75th year, helps create and maintain U.S. jobs by financing the sale of U.S. exports, primarily to emerging markets throughout the world, by providing loan guarantees, export-credit insurance and direct loans.