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New Report Details National Export Initiative's Role in Economic Recovery
Speaking to members of the President’s Export Council at the White House on September 16, 2010, President Barack Obama announced the release of a progress report on the National Export Initiative. (White House photo)
A comprehensive report to the president by the Export Promotion Cabinet on the National Export Initiative (NEI) highlights the efforts multiple federal agencies are already making to support U.S. exports and emphasizes the next steps that must be taken to meet the administration’s five-year goal of doubling U.S. exports and supporting millions of jobs.
by Robert Ackerman
With U.S. exports up significantly during the first half of 2010, the Export Promotion Cabinet, in a recent report, urged President Barack Obama to continue supporting policies that provide more support and trade financing to U.S. businesses to help them dramatically increase their international sales. “Report to the President on the National Export Initiative,” was released on September 16, 2010.
According to the report, under the goals of the president’s NEI, “Exports need to grow from $1.57 trillion in 2009 to $3.14 trillion by 2015. This will only happen if U.S. companies, farmers, and small and medium-sized enterprises (SMEs)—the engines of economic growth—receive the encouragement and support they need as they seek new markets for their goods and services.”
Obama announced the NEI in January 2010. It seeks to double U.S. exports by 2015 and to support millions of new jobs. The president released the report in advance of his meeting with members of his newly appointed President’s Export Council (PEC) in Washington, D.C.
Advice from Industry Leaders
Since its creation in 1973, the PEC has served as a critical line of communication between the private sector and the government regarding export policy and export promotion activities. On July 7, 2010, Obama appointed 18 additional leaders from business, agriculture, and labor to join representatives from government and Congress to a newly reconstituted PEC to provide advice on how the government can facilitate growth in U.S. exports. (See August 2010 issue of International Trade Update.) The PEC’s recommendations will play a vital role in the success of the NEI.
In his meeting with PEC members, Obama noted the challenges that lay ahead. “When I made this initial announcement [of the NEI], some were skeptical, but … if we are increasing our exports by 14, 15 percent per year—something that is achievable—then we can meet our goal. And that’s one of the ways that we’re going to make this economy in the 21st century what it was in the 20th century—an unparalleled force for opportunity and prosperity for all our people.”
According to the NEI report, U.S. exports increased almost 18 percent in the first six months of 2010 compared to the same period last year.
Lending, Program Outreach Grow
The NEI report notes the progress that has been made in providing loans to U.S. companies to increase exports and in making businesses aware of the different kinds of export assistance available. The report also details the progress in implementing several initiatives across the federal government that will be critical to the success of the NEI.
For example, in 2010, the Export–Import Bank of the United States (Ex–Im Bank) increased its loan approvals by nearly 20 percent over the previous year, from $18.3 billion to $21.5 billion. This change included an increase in small-business loan approvals from $3.6 million to $4.1 million. As a result, an estimated 30,000 U.S. jobs were supported by Ex–Im Bank financing.
Another example is the Small Business Administration (SBA), which also stepped up its efforts to support SMEs. In July 2010, SBA successfully launched a pilot version of its Export Outreach Team training program in Baltimore, Maryland, and plans to roll out the program nationally in 2011.
In addition to an unprecedented level of support during the past year for trade missions that take representatives from U.S. companies directly to foreign markets, there has been significant progress from bringing foreign buyers to the United States. Under its International Buyer Program, the Department of Commerce has secured the participation of nearly 8,800 foreign buyers at trade shows in the United States, which has facilitated more than $660 million in export sales.
The Department of Agriculture and the U.S. Trade Development Agency (USTDA) have also had success with reverse trade missions. The Department of Agriculture, for example, recruited more than 1,500 foreign buyers between January and September 2010. USTDA hosted 30 reverse trade missions during the same period, which represented more than $1 billion in export opportunities for U.S. companies.
For More Information
For more information about the President’s Export Council, visit the council’s Web page. The complete text of the Report to the President on the National Export Initiative, along with more information and news on the NEI, is available online at www.export.gov/nei.
The Way Forward
The NEI report emphasizes the importance of exporting to the U.S. economy, and it highlights the vast opportunities that exist for U.S. companies to sell their products to the 95 percent of the world’s consumers who live outside the United States. The report’s recommendations range from focusing on key markets and sectors to implementing specific strategies to help SME services exporters. Other recommendations include the following:
- Expanding and improving existing programs, such as trade missions
- Increasing export credit
- Elevating and focusing commercial advocacy
- Ensuring fair treatment for U.S. companies within the rules of the global trading system
- Working with other countries to pursue policies that will achieve strong, sustainable, and more balanced global growth
Obama, noting the importance of exports and the success of the NEI to future U.S. economic growth, told the members of the PEC, “From the day that I took office, my administration’s highest priority has been to pull our economy out of the deepest recession of our lifetimes, to put people back to work, and to position our economy on a path of long-term and sustainable growth.”
Secretary of Commerce Gary Locke, a member of the PEC, added, “Helping American companies sell more abroad will create jobs and boost our economy. This report is a blueprint for doing just that.”
Robert Ackerman is a special assistant for White House Initiatives in the Department of Commerce.
Why Do We Need a National Export Initiative?
Here is an excerpt from “Report to the President on the National Export Initiative”:
“Ninety-five percent of the world’s customers lie outside the United States; we ignore them at our peril. Tapping into customers in fast-growing markets abroad and in our traditional markets is crucial to putting the United States’ own economy on a solid footing—and generating the demand needed to put Americans back to work.
We cannot return to an economy that is driven by borrowing and consumption. To maintain robust growth, the world will need to rely less on U.S. consumption—and we will need to sell more to the rest of the world.
In 2008, exports supported over 10 million jobs and represented nearly 13 percent of gross domestic product. Exports fell during the recession. Meeting the NEI’s goal of doubling exports will bring them not just back to where they were, but to an even higher level, supporting millions of good jobs.
Exporting is fundamentally a decision driven by our entrepreneurs, workers, and farmers. But, businesses attempting to close an export sale today face many hurdles, including lack of readily available information about exporting and market research, challenges obtaining export financing, and strong competition from foreign companies and foreign governments. This suggests an important role for the federal government.
The NEI is the administration’s commitment to serve as a full partner with U.S. businesses to promote American-made goods and services worldwide, within global trading rules.”
The full report can be downloaded from the Web at www.export.gov/nei.
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