Facebook pixel

What They Are Saying: EXIM’s Board Unanimously Approves Historic Policy to Support U.S. Exporters Competing with the People’s Republic of China

Trade Associations, Financial Institutions, Transformational Export Companies, and Other Stakeholders Voiced Support Throughout EXIM’s Comprehensive Public Comment and Outreach

FOR IMMEDIATE RELEASE December 18, 2020

Media Contact Name/Phone: 

Office of Communications (202) 565-3207

WASHINGTON — The Export-Import Bank of the United States (EXIM) Board of Directors yesterday voted to establish a content policy specific to the agency’s Program on China and Transformational Exports after a comprehensive stakeholder outreach and public comment period, establishing a path for U.S. exporters in ten transformational export sectors to utilize EXIM support.

Trade associations, financial institutions, transformational export companies, and other interested stakeholders voiced their support throughout the process as EXIM worked to modernize its content policy, including during EXIM’s Strengthening American Competitiveness Initiative that engaged 1,100 stakeholders (May-Sept, 2020), Annual Conference , Board of Directors and Advisory Committee Meetings, and Public Comment Period.

U.S. GOVERNMENT OFFICIALS

  • Wilbur Ross, Secretary of Commerce, U.S. Department of Commerce and EXIM Board Member ex officio – Remarks from EXIM’s Board Meeting on Dec 17, 2020.
  • Keith Krach, Undersecretary, U.S. Department of State – “The continued expansion of companies like Huawei and ZTE, backed by the financial power of the People’s Republic of China, threatens the security and integrity of telecom networks around the world. EXIM today performed a great service to America’s economic and national security by modernizing its U.S. content policy. This expansion of the scope of U.S. financing available for 5G deals will help secure people’s data, companies’ intellectual property, and countries’ national security.” (EXIM Board Meeting, Dec 17, 2020)
  • Representative Andy Barr (KY-06)– “We know that it’s well intentioned to have a domestic content requirement, but when we’re competing in the telecommunications space, in particular 5G, we need to change that domestic content requirement because right now we cannot compete with China in 5G without partnerships. And that’s the most important thing to work in a multilateral way with our allies to displace Huawei and displace China’s malign efforts to dominate 5G that is critically important from an economic competitiveness standpoint, but also in terms of national security.” (EXIM Annual Conference, Sept 10, 2020)

FORMER GOVERNMENT OFFICIALS

  • Former Speaker of the U.S. House of Representatives Newt Gingrich – “EXIM’s move to lower content requirements is essential to ensure that US exporters have the opportunity compete with global suppliers, promote US jobs and industry, and enhance national security interests.”

INDUSTRY AND ADVOCACY ORGANIZATIONS AND THINK TANKS

  • U.S. Chamber of Commerce – “The Chamber views EXIM as one of the most important tools at the disposal of U.S. companies to level the playing field for trade finance as they seek to increase exports and create American jobs. … The domestic content reforms proposed by EXIM would help U.S. firms in these transformation industries to be able to compete on the global stage.” (Regulations.gov, Dec 11, 2020)
  • National Association of Manufacturers – “In order to fulfill this congressional mandate, the Ex-Im Bank is right to consider appropriate changes to its content policy, where necessary, to allow more manufacturers in the United States to have the opportunity to compete in today’s global market. Such changes will better reflect the realities of global supply chains in many sectors and result in more exports from the United States.” (Regulations.gov, Dec 14, 2020)
  • Information Technology Industry Council - “We support EXIM’s proposal to modify its U.S. content rules in the technology areas listed. We think this will help EXIM to support more transactions, bolstering the competitiveness of the United States and solidifying technological leadership.” (Regulations.gov, Dec 14, 2020)
  • Bankers Association for Finance and Trade – “U.S. stakeholders and financial institutions regularly identify EXIM’s content policy as the greatest challenge to EXIM’s ability to support U.S. exports. Changes to EXIM’s content policy would help level the ‘playing field’ for Export Credit Agency (ECA) financing, enhance the effectiveness of EXIM’s programs, and significantly improve U.S. exporters’ global competitiveness.” (Regulations.gov, Dec 10, 2020)
  • Nuclear Energy Institute – “U.S. competitiveness against China and Russia in international nuclear energy markets demands a more flexible approach to content requirements… To maximize the U.S. content in such projects and the number of American jobs supported, Ex-Im Bank must have greater flexibility to balance U.S. content requirements with the competitiveness of the U.S. offer.” (Regulations.gov, Dec 11, 2020)
  • Silicon Valley Defense Group – “As a matter of economic security and competitiveness, we support efforts at EXIM to modernize the agency’s content policy in order to help innovative high-tech industries to compete against unfair practices by countries, including China.” (Regulations.gov, Dec 14, 2020)
  • One Defense – “We support efforts at EXIM to modernize the agency’s content policy in order to help innovative high-tech industries to compete against unfair practices by countries, including China.” (Regulations.gov, Dec 14, 2020)
  • Jones Group International – “Good for EXIM to modernize its policies in order to counter competition from China. The specific inclusion of 5G equipment in the wireless communication category opens the door to leveling the playing field for the speedy replacement of Huawei equipment in our partners. This allows democratic countries to have secure networks focused on individual personal privacy versus government surveillance. In the near future, you will quickly be able to tell if you are in an autocratic or democratic nation by the characteristics of its 5G network.” (Dec. 17, 2020)
  • ClearPath – “Given the fledging supply chains for renewable energy technologies within the U.S., having a content policy that aligns with our manufacturing base is all the more important as we try to ensure growth in our domestic industries. The lower content level allows us more flexibility to partner with our allies and ensure that U.S. companies are still heavily involved.” (Regulations.gov, Dec 14, 2020)

FINANCIAL INSTITUTIONS

  • Deutsche Bank – “Deutsche Bank would welcome changes to EXIM’s foreign content policy, which is generally acknowledged as being more restrictive than that allowed by other European and Asian Export Credit Agencies. As such, the policy puts US exporters at a relative disadvantage compared to their overseas counterparts when bidding for large, complex projects which by their nature require equipment and services to be sourced from more than one country.” (Regulations.gov, Nov 30, 2020)
  • Marsh & McLennan Companies, Inc. – “MMC supports the proposed change to the content policy, more specifically the new ‘Program on China and Transformation Exports,’ to assist American exporters as they face competition in transformational export sectors. Countering the threat as identified specifically from China, but also other countries, will be important for the return of the US EXIM bank as a preeminent ECA and the champion of US workers on the global stages.” (Regulations.gov, Dec 11, 2020)
  • Horn & Watson Capital Strategies LLC – “On the issue of content eligibility, US Ex-Im Bank has been the least competitive and most inflexible export credit agency for many decades… The US remains an export powerhouse but must adopt new policies which reflect increased competition and flexibility in the realm of export credits.” (Regulations.gov, Dec 14, 2020)

TRANSFORMATIONAL EXPORT COMPANIES

  • Microsoft Corporation, Inc. – “EXIM’s current content policies do no offer U.S. exporters of 5G technology the necessary flexibility to compete globally on a level playing field. …EXIM’s current content policy is unsuited to supporting 5G technology exports.” (Regulations.gov, Dec 14, 2020)
  • Medtronic – “In an effort to promote a stronger partnership between EXIM and US medical technology companies and to enhance US competitiveness in this unquestioned domain of US industrial leadership, we would humbly suggest EXIM adjust its content policy to be consistent with what is outlined by the US Department of Commerce’s Advocacy Center.” (Regulations.gov, Dec 11, 2020)
  • First Solar –“A change in mindset is necessary for American energy companies to successfully compete against China: its success is primarily driven by its ability to identify areas of strategic interest, acquire the know-how, and willingness to decimate the competition and win at all costs. Therefore, it is vital for institutions, such as the U.S. EXIM Bank, to develop an enablement strategy, in alignment with its partner agencies, designed to nurture the growth and expand the opportunity set for strategic energy sectors internationally, while staying true to the principles of free and fair trade.” (Regulations.gov, Dec 14, 2020)
  • CISCO – “The current ExIm content rules make it difficult for ExIm to support the American networking industry effectively, as they are based on the nature of how other industries operate and do not recognize the reality of the modern technology industry.” (Regulations.gov, Dec 14, 2020)
  • Networked Energy Services – “We strongly support EXIM Bank making changes to its content policy that will help US companies compete with Chinese companies around the world… In the absence of a true international level playing field, the financing options offered by EXIM provide US companies with some very useful competitive tools.” (Regulations.gov, Dec 13, 2020)
  • OSI Systems Inc. – “If EXIM were to change their policy of U.S. Export Content and/or reduce content requirements to a range of 50 percent to 20 percent U.S. content, US firms like ours would be more competitive internationally.” (Regulations.gov, Dec 13, 2020)
  • Philips North America LLC – “Changes to EXIM’s foreign content policy along the recommended lines would directly benefit exports of the U.S. medical technology industry… Therefore, the concept of substantial U.S. interest, as defined by Commerce Department Advocacy Center guidelines, could go far in assisting our competitiveness overseas.” (Regulations.gov, Dec 13, 2020)
  • Tetra Tech – “The present content policy at US Ex-Im is one of the factors that fails to help US exporters in competing water/wastewater infrastructure projects, especially in the developing world.” (Regulations.gov, Dec 7, 2020)
  • CC Solutions – “In order to better compete with the Chinese agencies, EXIM should amend its content policy so that EXIM covers 85% of any export contract that includes at least 50% US content and at most 23% of local content.” (Regulations.gov, Dec 1, 2020)
  • Nokia – “An updated content policy will allow EXIM to play an important role in a whole-of-government approach to protecting not only the value created by technology companies in the United States but also in securing 5G networks, an essential platform to the next economy.” (Regulations.gov, Dec 14, 2020)
  • Parallel Wireless – “Without a change to the traditional approach on content restrictions, EXIM resources would be largely unavailable to US companies working hard to compete against Huawei and ZTE.” (Regulations.gov, Dec 14, 2020)
  • Maxar Technologies – “While it may remain useful to have a US content target, Ex-Im should be allowed latitude within wide parameters based on the broader national interest in any specific transaction or contract.” (Regulations.gov, Dec 14, 2020)

EXIM ADVISORY COMMITTEE MEMBERS

  • EXIM Advisory Committee – “EXIM should increase the competitiveness of its content policy to better align with other U.S. agencies and foreign export credit agencies. Specifically, we recommend a U.S. content minimum of 20-30 percent to better level the playing field with our foreign allies and competitors within the Organisation for Economic Co-operation and Development (OECD) such as Japan and the United Kingdom.”
  • Stevan Pearce, Chair, EXIM Advisory Committee, Chief Executive Officer/Manager, Trinity Industries, Inc., Former Member, U.S. House of Representatives – “U.S. businesses and workers are increasingly competing against entities that have the full weight of the PRC government behind them. Modernizing EXIM’s content policy will make American exporters more competitive, supporting workers and increasing U.S. leadership around the world.” (Exim.gov, Dec 2, 2020)
  • Ambassador Paula Dobriansky, Chair, EXIM Subcommittee on Strategic Competition with the People’s Republic of China (Chairman’s Council on China Competition), Senior Fellow, Harvard University Belfer Center for Science and International Affairs, Vice Chair, Scowcraft Center for Strategy and Security, The Atlantic Council – “EXIM should increase the competitiveness of its content policy to better align with other U.S. agencies…and also foreign export credit agencies.” (Exim.gov, Dec 2, 2020)
  • Daniel Runde, Chair, EXIM Sub-Saharan Africa Advisory Committee, Senior Vice President, Director of the Program on Prosperity and Development, Center for Strategic and International Studies – “The U.S. EXIM Bank has not revisited its content policies since the 1980s. For example, our ECA peers and competitors have updated their content policies and have given our competitors an advantage. Currently, both our peers and competitors have much lower requirements than the U.S. does.” (Regulations.gov, Dec 8, 2020)
  • Derek Campbell, CEO, Energy and National Resource Security, Inc. – “I see this as a matter of national security interest for us as we compete with China. And as an entrepreneur who operates in Africa and other places in the world. There have been opportunities that I’ve missed that could’ve had a very nice U.S. stamp, a very nice U.S. hegemonic flair to it because I couldn’t meet the requirements or the opportunity couldn’t meet the requirements to have an 85 percent content.” (Exim.gov, Dec 2, 2020)
  • Rich Powell, Executive Director, ClearPath – “The United States must maintain its global leadership role in clean energy. Over the past decade, other nations like China and Russia have been rapidly growing their energy exports putting the climate, our national security, and job growth at risk. Bringing EXIM’s content policy in line with other federal agencies and export credit agencies of allies and OECD members will make it easier for U.S. companies to advance clean energy around the globe. Not only will this make it easier for EXIM to meet its clean energy goals, it will also support high-quality jobs here in America.” (Exim.gov, Dec 2, 2020)
  • Bill Cummins, Executive State Director, Alabama SBDC Network, The University of Alabama – “Having worked in trade finance for well over 30 years, I had several instances where deals were simply lost because the exporter couldn’t meet the minimum content requirements.” (Exim.gov, Dec 2, 2020)
  • Maria Cino, Vice President, Corporate Affairs for the Americas, Hewlett Packard Enterprise – “Companies like mine know first-hand the challenges of staying competitive in an ever-changing global marketplace. It’s great to see Chairman Reed and the EXIM board of directors take a sharp look at EXIM’s policies and bring them into the 21st century. Modernizing EXIM’s content requirements will level the playing field and support high-tech jobs here at home.” (Exim.gov, Dec 2, 2020)
  • Rodney Ferguson, President and Chief Executive Officer, Winrock International – “I think that it seems to me to make more sense to look at something reasonable in the short-term like 50 percent, which would also put us in concert with the Department of Commerce.” (Exim.gov, Dec 2, 2020)
  • Joanne Young, Managing Partner, Kirstein & Young, PLLC –“We need to make our content policy and all other policies as helpful as they can be so that we don’t slip back… I support the letter and relaxing the content standards as have been suggested.” (Exim.gov, Dec 2, 2020)
  • Bill Huntington, President, N.A. Wholesale Men’s, Kids’ & Home, Ralph Lauren Corporation – “Ours [content policy] is one of the highest in the global marketplace and clearly there are some hindrances to allowing and enabling our U.S. workers to compete in this increasingly competitive marketplace.” (Exim.gov, Dec 2, 2020)
  • Venkee Sharma, Chief Executive Officer, Aquatech International – “I represent a small business, but I also represent water treatment, which is one of the transformational exports. … Competition, for us over 25 years, the importance of content has resonated more and more year on year. And to this point, we can take data and see all the deals we lose, or we’re not even in the same playing field.” (Exim.gov, Dec 2, 2020)
  • Alex Sanchez, President and CEO, Florida Bankers Association – “It is great to see EXIM proactively helping U.S. industry counter competition from China. If the U.S. doesn’t maintain leadership in its strategic sectors and supply chains now, then it will become even harder to do so in the future. Chairman Reed has been promoting American companies and exports since the day she was sworn in as the head of the EXIM bank.” (Exim.gov, May 6, 2020)

ABOUT EXIM:

EXIM is an independent federal agency that promotes and supports American jobs by providing competitive and necessary export credit to support sales of U.S. goods and services to international buyers. A robust EXIM can level the global playing field for U.S. exporters when they compete against foreign companies that receive support from their governments. EXIM also contributes to U.S. economic growth by helping to create and sustain hundreds of thousands of jobs in exporting businesses and their supply chains across the United States. In recent years, approximately 90 percent of the total number of the agency’s authorizations has directly supported small businesses. Since 1992, EXIM has generated more than $9 billion for the U.S. Treasury for repayment of U.S. debt.

For more information about EXIM, please visit www.exim.gov.