Private companies are increasingly exploring new markets in the developing world. Export credit agencies, such as the Export-Import Bank of the United States, are among avenues that can help them make inroads.
U.S. companies in the clean energy sector, for instance, are set to benefit from one of Exim’s latest undertakings: a plan to support the transfer of some $2 billion worth of U.S.-made clean energy technologies and services to South Africa. Exim President Fred Hochberg signed a declaration of intent to this effect Aug. 7 in South Africa, where he also participated in the U.S.-South Africa Strategic Dialogue with U.S. Secretary of State Hillary Clinton.
The country and the rest of sub-Saharan Africa is a priority region for Exim Bank. Hochberg said this is because many countries in the region “have strong prospects for long-term economic growth and infrastructure development.” That is also why the bank is spending $1.5 billion to support the export of U.S. goods to sub-Saharan countries in the first three quarters of 2012.
Exim Bank, as with fellow export credit agencies, is tasked primarily to strengthen U.S. companies’ sales to existing markets and explore new ones. The bank does this through loans, guarantees and insurance to facilitate trade between large and small companies in the United States and buyers from around the world. It also provides financing to foreign buyers to help them successfully secure U.S. goods and services.
All U.S. export firms, regardless of size, are eligible for assistance from Exim Bank. Small and midsize businesses do get an advantage given the breadth of Exim programs designed to support this sector of the U.S. commerce industry. Buyers of U.S. goods are also eligible to receive assistance.
Countries with similar active export credit agencies include China. The Chinese Export-Import Bank and the China Development Bank, in particular, have channeled some $110 billion in loans to development country governments and companies between 2009 and 2010. This surpassed the World Bank’s spending in the same countries within that period.
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