A recent survey was sent to all CCA members. It had a remarkable rate of return at nearly 60 percent, indicating a strong interest in the future directions of CCA. One of the questions we asked was what government institutions were most important to your relationships and business in Africa. It was no surprise to me that the State Department ranked first. However, the relationship with the Export-Import Bank of the United States was ranked as a very strong second. I admit some surprise given that a lot of our members have expressed so much frustration with the pace of decision-making within the Ex-Im Bank, and the difficulty that they have securing financial support through Ex-Im.
However, with a bit deeper reflection, it is very apparent of the importance of the Ex-Im Bank, even to those who are concerned by the slowness and sometimes aversion to risk evident in their decision-making. Deals in Africa are far more dependent on assurances of financing and financial guarantees than in other region of the world. Without some certainty of financing, badly needed investment in infrastructure doesn't happen and what does happen goes to businesses in other countries like China. Financing is in place quicker elsewhere and their systems are much more centralized. Our competitive advantages are in quality and long-term durability, but we can't compete without financing and financial guarantees. Ex-Im Bank is one of the very few structures in America designed to help U.S. companies selling abroad.
It is therefore with great dismay and astonishment that reaches into disbelief that Congress has not renewed the mandate for Ex-Im Bank and has allowed it to expire, making it impossible for some companies to sell to Africa, or anywhere else for that matter. Some Congressmen and Senators have argued that the EX-IM Bank is simply a system for corporate welfare, noting that most of its support goes to only a few major companies. While there are many companies that do get Ex-Im support, the bulk of that support has gone primarily to the airline industry and the companies that are engaged with that industry. However, the fact is that without Ex-Im support we don't have an airline industry in America. Ex-Im support allows the airline companies and defense industry to sell in a timely manner to countries seeking U.S. made products. The Boeing Company alone has employees in 42 States in the country. General Electric, which manufactures engines for the air industry also has plants throughout the country. The engines that will supply the power industry in Africa, a central tenet of U.S. policy to Africa are made in America…for now. General Electric has already announced the necessity of moving a part of its operations out of the country if they want to secure financing from foreign banks, solely due to the lack of access to Ex-Im funding.
The fact is that Congress may destroy the U.S. airplane industry and seriously damage one of America's corporate giants by shutting down Ex-Im as they have. I have seen confidential correspondence that underlines this reality. While there is some merit in the claim that Ex-Im serves too few, Congress itself is to blame for this mess. Ex-Im was created to mitigate risk for American companies selling abroad. Yet Ex-Im's performance and the raison d'etre is measured and reviewed by Congress based on how much net profit it returns to Treasury each year, thus inhibiting anything remotely seen as risk. It is no surprise that support for businesses investing in Africa is the lowest of any geographic region in the world, even though it is the fastest growing market worldwide as it is seen as high risk by those in Ex-Im Bank. That alone is a problem that Congress must address.
However, before Congress does that it is of the highest importance that Congress end the madness that is putting U.S. industry and manufacturing and the American economy at risk and renew funding for the Ex-Im Bank immediately. More than a few corporations and hundreds of thousands of jobs are at real risk.
