The New England Council has a long history of support for free trade and expanded access to foreign markets for New England businesses. Over the years, the Council has been proud to support free trade agreements and other initiatives to support U.S. exports.
In February 2014, with the U.S. actively pursuing several significant multi-lateral trade agreements–the Transpacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP)–the Council launched a Trade Working Group. The working group serves as a forum for NEC members across various sectors and industries that have an interest in expanded free trade and increased access to foreign markets to share information and work collaboratively toward shared goals and interests. The working group is chaired by Viji Rangaswami of Liberty Mutual.
In April 2015, the Council released a white paper that highlights the tremendous economic impact that trade has on the New England region, and outlines the Council’s principles on trade policy. That white paper is updated as needed and can be found HERE.
With several major multilateral trade agreements on the horizon in the spring of 2015, Congress considered legislation to grant Trade Promotion Authority (TPA). On April 29, 2015, The New England Council sent a letter to members of the New England Congressional delegation expressing its support for TPA as a critical first step to increasing access to foreign markets for New England businesses. The Council stressed the tremendous benefit of international trade on the New England economy, and urged members of Congress to support TPA so that agreements like the Trans Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP) can move forward.
In addition to the letter endorsing TPA, the Council also shared with New England Senators and Representatives a white paper that outlines the positive economic impact of trade in New England, and discusses the Council’s principles and priorities for trade policy.
The Export-Import Bank of the United States (Ex-Im Bank) is the official export credit agency of the United States. Ex-Im Bank’s mission is to assist in financing the export of U.S. goods and services to international markets. The bank’s charter was extended on a short term basis in 2014, and will expire on June 30, 2015, without Congressional action.
Nearly one-third of U.S. economic growth since mid-2009 has been driven by exports. In fiscal year 2013, the Ex-Im Bank directly supported 205,000 jobs across the U.S. In the same year, the Ex-Im Bank earned more than $1 billion in profit for the U.S. Treasury, mostly through fees collected from foreign customers.
The New England Council supports reauthorization of the Ex-Im Bank, and has urged Congressional leaders to pass a long-term reauthorization. In a June 2014 letter to New England Senators and Representatives, the Council stressed that the bank is a key financial tool that provides stability and continuity for companies in New England and the United States. The letter also noted that it is imperative for the continued growth of New England exporters that they have access to this supplemental financing capability in order to remain on a competitive footing with the nations of the world.
A similar letter was also submitted for the record to leaders of the House Financial Services Committee, which held a hearing on reauthorization in late June 2014.
As the reauthorization effort was under debate in Congress, the Council was honored to host Ex-Im Bank Chairman Fred Hochberg at a July 2014 luncheon in Boston. Chairman Hochberg outlined the bank’s role in supporting U.S. exports and driving economic growth, and highlighted several New England businesses that have benefitted as a result of the bank’s support.
In addition to these advocacy efforts in support of Ex-Im Bank reauthorization, The New England Council joined the Ex-Im Coalition, a group representing manufacturers that rely on access to competitive export financing to reach customers overseas and supporting the reauthorization of Ex-Im. Through this coalition, the Council joined over 800 other businesses and business groups in signing a letter to members of Congress urging reauthorization.
In July 2014, the Council was honored to host Ex-Im Bank Chairman Fred Hochberg at a luncheon in Boston. Chairman Hochberg outlined the bank’s role in supporting U.S. exports and driving economic growth, and highlighted several New England businesses that have benefitted as a result of the bank’s support.
It’s important to note that in the six New England states, the Ex-Im Bank has backed $3.15 billion in disbursements, insured shipments, and guaranteed credit for exports since 2011. This has supported nearly $6.6 billion in export sales related to Ex-Im Bank authorizations. Nationally, the Ex-Im Bank in fiscal year 2015 alone enabled some $17 billion in exports from thousands of companies, supporting approximately 109,000 American jobs and returning more than $431 million to the Treasury.
These figures would have doubtless been higher, however in June of 2015, Congress did not act on a reauthorization measure, and the charter of the Ex-Im Bank expired. While some wanted to keep the Bank shuttered, a bipartisan coalition on Capitol Hill rallied to its defense. In December of 2015, Congress passed and the President signed into law the Fixing America’s Surface Transportation (FAST) Act which included an extension of the charter of the Export-Import Bank for a period of four years (through September of 2019). To accommodate the concerns of detractors, the new law lowers the $140 billion statutory cap on outstanding loans, guarantees, and insurance to $135 billion and freezes loans should a default rate of more than 2 percent occur. In addition, the law requires steps to heighten accountability and transparency including the appointment of a chief ethics officer and a chief risk officer; raises from 20 to 25 percent the amount of lending to go to small businesses; initiates a “loss reserve” account of 5 percent of aggregate transaction amounts; and requires the Ex-Im Bank to take steps to negotiate an end to export subsidies among nations across the globe.
The New England Council was pleased that the President and Congress acted on the need to renew this vital agency.
Trade Leaders Discuss Free Trade
As the United States pursues two major multi-lateral trade agreements—the Transpacific Partnership (TPP) in Asia, and the Transatlantic Trade and Investment Partnership (TTIP) in Europe—the Council has closely monitored the progress of negotiations and provided regular updates to members. The Council will continue to work with members as the agreements are finalized to develop the Council’s position on the agreements’ provisions and articulate those positions to our leaders in Congress.
In June 2014, the Council was honored to host Ambassador Michael Froman, the U.S. Trade Representative, at a luncheon in Boston. Ambassador Froman provided updates on the TPP and TTIP negotiations, and highlighted the benefits of expanded access to foreign markets for businesses in New England and beyond.
In March of 2016 Chairman Hochberg returned to the Council , this time speaking to a wider New England Council audience during our annual Washington, D.C. Federal Policy Briefing. Mr. Hochberg noted that it is the goal of the Ex-Im Bank to advance U.S. jobs and U.S. workers, and with a four-year reauthorization of its charter, they have a better chance to even the playing field across the globe. The Chairman also noted that through the advocacy of the New England Council and others, the Ex-Im Bank had received a new lease on life to carry out its work.
Another participant in the Council’s D.C. Federal Policy Briefing was Chief of Staff to the U.S. Trade Representative and New England native, Matt Vogel. Mr. Vogel shared with Council members his insight on the Administration’s trade policy, pointing out that their trade efforts have been focused on TPP, TTIP, and revitalizing the World Trade Organization (WTO). In advocating for the Administration, Mr. Vogel noted that the best way to grow investment in the United States and for U.S. companies is through trade.
Earlier in 2016, The New England Council’s Trade Working Group (TWG) held a conference call with Mr. Luis Jimenez, Counselor to the U.S. Trade Representative and Diana Doukas of the White House Business Council. The two leaders discussed the Administration’s efforts on moving forward with the TPP, noting that the TPP will open business opportunities with the growing Pacific-rim middle class consumer base.
Recently from the Blog
September 16 Weekly Round-Up: NEC Members Contribute to COVID-19 Crisis Response