The US Export-Import Bank Stimulates Exports

One year after the US Export-Import Bank (EXIM) was reauthorized by Congress, the debate over its future continues to rage. EXIM, meanwhile, remains hampered by lack of a three-member quorum on its Board, preventing it from approving transactions over $10 million. Currently the five-member Board has only two serving directors. The main issue in the debate is whether the Bank, which provides financing and insurance for US businesses that want to export, substitutes for the private sector or whether—as its advocates argue—it helps US companies compete in markets where private financing opportunities are scarce. This Policy Brief analyses the relationship between historical EXIM financing and export volumes and shows that EXIM lending stimulates US exports. In fact, every dollar authorized by EXIM results in $1.35 in greater exports. EXIM is not a substitute for private finance but is additive, helping US companies to be competitive in foreign markets. The Bank expands US exports, reducing the trade deficit, and returns the profits from its business to the US Treasury. Over the period studied, 2007–14, EXIM transferred more than $4 billion to the Treasury.