Congress is set to reauthorize the Export-Import Bank for seven years as part of a must-pass government funding bill, including reforms to the agency’s financing of sales to China meant to appeal to hawkish Republicans.
The bank, known as Ex-Im, helps finance sales to other countries by providing loans or loan guarantees. It has been hamstrung for most of the Trump era by conservatives who argue that it represents corporate welfare.
The reauthorization would address concerns that some of the bank’s financing benefits the Chinese government by directing the bank to set a goal of reserving 20% of its authority to support American exports that compete directly with exports from China and certain innovative technology exports, such as artificial intelligence and 5G technology. That goal, however, would not be mandatory.
Furthermore, the legislation would require the bank to report to Congress that it has consulted with the State Department and other appropriate agencies when assessing the risk of transactions over $25 million for which it believes the entity getting the loan is an organization controlled by the Chinese government.
At the beginning of this year, the bank was effectively paralyzed for the previous three years because of a lack of a quorum, as critics had blocked nominations for open seats, including ones picked by President Trump. In early May, however, the Senate approved three new members to the bank’s board, allowing it to return to activity.
The Bank’s reauthorization charter will fix this quorum issue by establishing a temporary board in the absence of a sufficient number of Senate-confirmed members.
“Our bipartisan renewal of the Export-Import Bank helps Arizona employers sell more products overseas, create more jobs at home, and it represents a step away from Congress’s usual short-term crisis management,” said Sen. Kyrsten Sinema, an Arizona Democrat who authored legislation to renew the bank’s charter.
Another provision in the reauthorization would require the bank to increase small business exports from 25% of its overall portfolio to 30% and will require it to reserve 5% of its loans to support renewable energy, energy efficiency, and energy storage. Those changes are meant to address criticisms from the Right that Ex-Im disproportionately benefits big businesses such as Boeing and from the Left that it helps finance businesses that rely on fossil fuels.