A new report from the Government Accountability Office has questioned the reliability of data from the Export-Import Bank of the United States on how well the bank is supporting small-business exporters.
Ex-Im Bank, the nation’s official export credit agency, provides loan guarantees and insurance to commercial banks that, in turn make trade credits available to U.S. exporters. According to the Ex-Im Bank website, 85 percent of its transactions directly benefit U.S. small businesses.
The bank generally concurred with the GAO’s recommendations and identified several actions it is taking or will take to address them, according to the congressional watchdog agency.
The GAO report asserted that Ex-Im Bank generally classifies companies’ small-business status correctly, but that weaknesses in the bank’s systems and data limit its ability to determine its small-business financing. For some transactions, noted the GAO, Ex-Im Bank cannot identify the exporter, so it must estimate the small-business share based on earlier shipment patterns. The GAO also determined that the bank included transactions that do not benefit small business in its overall count.
Rep. Don Manzullo (R-Ill.), chairman of the House Small Business Committee, said in a press release: “The GAO report shows why Ex-Im Bank is not meeting its statutory obligation to help America’s small business owners secure the financing and insurance they need to operate internationally. While I am pleased to see Ex-Im has committed to act on the GAO’s recommendations, I believe this report reinforces the need to set up a small business office at Ex-Im and to enact programmatic changes to Ex-Im’s medium term loan and guarantee program to make it more attractive to small exporters.”
According to the committee, as of 2002 the bank is required to set aside at least 20 percent of its financing for small businesses. “However, since then, it has failed to meet this mandate despite the growth in overall exports supported by Ex-Im,” it asserted.