JUNEAU — The U.S. Congress has reauthorized the Export-Import Bank of the United States, in an effort to boost trade by helping finance operations of American companies overseas.
Among the projects the bank has assisted with billions in loans and other financing are liquefied natural gas export efforts in Australia and Papua New Guinea, ventures that target Asian LNG markets and may compete with Alaska’s natural gas export plans.
The Export-Import Bank had been barred from making new loans for the last five months after tea party conservatives in Congress said it violated free-market principals and blocked its reauthorization. They were joined by U.S. Sen. Dan Sullivan, who voted against reauthorizing the bank’s charter then.
Alaska’s two other members of Congress, Sen. Lisa Murkowski and Rep. Don Young, each supported it. All three are Republicans.
But after the Senate included reauthorization of the program in the federal highway bill that was recently passed by Congress, and signed into law by President Obama on Dec. 4, the Export-Import Bank is back in business.
Young praised the reauthorization, which he voted for in the highway bill, saying it would be good for the U.S. economy. Young spokesman Matt Shuckerow said the congressman supports the bank “for its core mission to create American jobs.”
The bank has generated billions in annual exports and hundreds of thousands of jobs, and the new reauthorization gives new support for small businesses, he said.
With the bank operating again, it will now be available to play a role in financing Alaska LNG, the state’s ongoing plan to export its vast North Slope natural gas reserves through a pipeline to Nikiski and as LNG to Asia.
State officials say that while they have not yet developed an Alaska LNG financial plan, if ongoing studies continue to show the project is viable the Export-Import Bank will likely be considered as a source of financing.
The bank offers loans, loan guarantees and other financial tools, and is self-supporting.
But critics such as Sullivan have said the bank leaves U.S. taxpayers at risk of losses, and has the “federal government pick winners and losers,” said Mike Anderson, Sullivan’s press secretary, after the senator voted against the bill earlier.
After that earlier rejection of the bank, it was included in the new federal highway bill, considered a must-pass measure.
Anderson did not respond to phone and email questions about Sullivan’s vote in favor of the highway bill, and thus the bank.
After its passage, FreedomWorks, a conservative, free-market advocacy group, called it “another knife in the back of the conservative grassroots.”
The group’s Noah Wall said the months without the bank showed that it wasn’t as crucial as had been claimed.
“Supporters of the Export-Import Bank acted like the sky was falling when Congress didn’t renew its charter this summer. Obviously, these Chicken Littles were proven wrong,” Wall said in a press release.
Information provided by Rep. Young’s staff shows that the Export-Import Bank is required by law to supplement, not compete, with private financing.
The bank has returned $7 billion in profit to the U.S. treasury over the last two decades, Shuckerow said.
It allows U.S. companies to compete for overseas business with companies in other countries that have assistance from their own export credit financing programs, the bank says.
Among the companies using it are Alaska LNG partners ConocoPhillips and Exxon Mobil, in the Australia and Papua New Guinea LNG projects respectively.
The Export-Import Bank said its $3 billion loan for the Papua New Guinea LNG project will support 55 U.S. companies involved in the project. Among those companies is Anchorage-based Lynden Air Transport, which says it provides services to Exxon and numerous other companies using the Export-Import Bank and supports renewal.
This article was written by Pat Forgey from Alaska Dispatch News, Anchorage and was legally licensed through the NewsCred publisher network.