Top executives from Xanté Corporation, a local printing technologies manufacturer, were huddled in a demonstration room at the company’s headquarters on Dauphin Street Thursday.
They had gathered to meet Fred Hochberg, president and chairman of the Export-Import Bank, and to show him how their machines can churn out flawless copies on heavy-stock paper in an instant. But Xanté, one of the leading users of the Bank’s services over the last five years in the southwest Alabama region, also wanted to convey a message: we need you.
The survival of the 80-year-old agency has been a bit challenged lately. Lawmakers are divided on whether they will extend its charter, which expires on June 30., Known informally as the Ex-Im Bank, the agency provides a number of financing options for American companies that want to sell goods abroad.
Their services include lending money to foreign buyers of US products, and guaranteeing private sector loans used to ship merchandise to foreign countries.
Critics of the bank say its purpose is nothing more than corporate welfare, serving primarily as a financial backer for major corporations like Boeing, Caterpillar and General Electric. But Ex-Im Bank officials contend that many of its customers are smaller companies, like Xanté, who rely the agency’s products to boost international sales.
“If you look at the actual dollars, as well, almost 40 percent of the dollars are goods being shipped from small companies,” Hochberg said in an interview. “So yes, I hear the criticism but the facts don’t support it.”
About 90 percent of the authorized services provided in 2014 were for small businesses, according to the Ex-Im Bank. Hochberg added, “Yes, we do a lot with big companies, but we do more with small businesses.”
In Alabama, for example, the top beneficiary of the Ex-Im Bank’s services by dollar amount for the last five years has been INEOS Americas, a global chemical manufacturer with operations in Theodore that counts 17,000 employees worldwide.
INEOS America has benefitted from $95.8 million in government-provided insurance, loans or credit guarantees since 2010, according to Ex-Im Bank data.
But transactions of that size aren’t common. That’s the message the agency is trying to communicate, hence Hochberg’s visit to Mobile. Hochberg held the event along with U.S. Rep Bradley Byrne, R-Fairhope. He’s has hosted more than 70 Global Access Forums since 2011 to educate entrepreneurs about the bank’s resources.
Just moments before the visit to Xanté, Hochberg spoke to a group of people in a conference room at the Renaissance Mobile Riverview Plaza Hotel and Spa.
The bank’s existence has emerged as a divisive issue (particularly among Republican lawmakers). Rep. Stephen Fincher of Tennessee introduced a bill, harnessing 57 Republican cosponsors, at the end of January that would reauthorize the bank for 5 years. But the bill has not yet come up for a vote.
If Byrne was persuaded one way or the other, he didn’t say as a matter of fact. “My decision is going to turn on those people in that room right there…,” he said during an interview. Byrne acknowledged that the Ex-Im Bank is one of the few federal agencies that actually return money to the federal government — about $675 million last year.
“This really gets down to — I would hope for every congressman — is this helping the people in my district or not? And if it’s helping the people in my district, and if it’s helping the people in my district in a fiscally responsible way it’s hard for even a deficit hawk like me to say that’s not something we should continue.”
For companies like Xanté, which has obtained loans backed by the bank, losing the agency would impact as many as 40 jobs, according to its CEO Robert Ross. The company has about 125 employees in Mobile and about 35 percent of its sales are international, company officials said.
“It allows us to go to countries, ship the product and when the customer sees it, the customer pays us,” Ross said. “It’s just the way business has to be done.”
March 12, 2015