Trump Nominates Ex-Im President
On June 20, President Donald Trump tapped Kimberly Reed, a former Treasury official and president of the International Food Information Council Foundation, to lead the U.S. Export-Import Bank (Ex-Im), marking the next step forward in the years-long fight to revive the bank. Previously, on April 25, he appointed Jeffrey Gerrish to be the Acting President of Ex-Im, while he also maintained his role at the Office of the U.S. Trade Representative.
Ex-Im operates under a renewable general statutory charter, and was extended through Sept. 30, 2019 by the Export-Import Bank Reform and Reauthorization Act of 2015, a surface transportation authorization measure. Enacted on Dec. 4, 2015, the measure lowered Ex-Im Bank’s statutory lending authority (“exposure cap” for outstanding portfolio) to $135 billion for each of FY2015-FY2019, and made reforms in a number of areas, including to Ex-Im’s policies or operations in risk management, fraud controls, and ethics, as well as to the U.S. approach to international negotiations on export credit financing.
Ex-Im had been without a President and Chairman since President Donald Trump took office and the last of the bank’s five board members quit in March. Since 2015, it has not had the quorum of at least three members it needs to finance deals or projects worth more than $10 million.
Ms. Reed had already been approved by the Senate Banking Committee to serve as the Ex-Im Bank’s vice president, but President Trump withdrew that nomination on June 20 when picking her to serve atop the agency. A bipartisan majority of senators on the Banking panel blocked confirmation of Trump’s original pick, former Rep. Scott Garrett (R-N.J.), amid concerns that he would try to hamstring the bank from within if confirmed.
Senator Pat Toomey (R-Pa.), an Ex-Im opponent, has a hold on the other three Ex-Im nominees—Spencer Bachus, Judith Pryor and Claudia Slacik—who were approved by the Senate Banking Committee and are pending on the Senate floor and he has pledged to derail further confirmations as a protest against Garrett’s rejection.
Following Ms. Reed’s nomination, Sen. Toomey said that he would meet with Ms. Reed but offered no clear indication of whether he would lift his hold. House Financial Services Chairman Jeb Hensarling (R-Texas), though, wants Sen. Toomey to continue to hold on the nominees.
In recent years, Ex-Im has been barely functional. According to its most recent annual report, Ex-Im authorized just $3.4 billion of mostly short-term export credit in 2017. That is down from the $20 billion that it authorized in 2014, the last year that the bank was fully operational. The report points out that China provided $34 billion in medium- and long-term financing for its exports in 2016, underscoring the competitive disadvantage that the United States faces.
After Ex-Im’s board became empty in March, NSBA and its international trade arm—the Small Business Exporters Association (SBEA)—continued to call for the Senate to hold a floor vote on the pending nominees, as the lack of action is costing American jobs and competitiveness overseas, leading to trade imbalances and slower growth opportunities, especially for small exporters.