Exporting and Trading info

Conclusion Besides the federal programs it is apparent the various states, counties, cities, world trade centers, trade associations, ports, universities and colleges, all have something to offer in the quest for sources of information and assistance to expand profits and sales through exports. And yet, there are still more sources, including national or international organizations, such as AID, the World Bank, the U.N., and even an organization as unfamiliar to most as the Organization of Economic Cooperation and Development (OECD). The contacts for all of these and many more may be found in the appendices or in the specific programs described elsewhere in exporters-sources.com - index page -. To enlarge on these examples, consider AID. This U.S. agency operates throughout the less developed countries of the world and administers economic assistance programs for the federal government in more than 60 developing countries, encouraging them to purchase U.S. goods and services with AI

Financial assistance The SBA offers direct loan and loan guarantee programs to assist small businesses. In recent years Congress has increasingly mandated that SBA provide special attention to business support in the export area as the trade imbalance worsens. As a result, there are now parallel financial programs for export and for domestic business. Since the loan officers in SBA have historically concentrated on longer-term working capital loans and fixed asset loans, it is often difficult for them to adjust to the concept of trade finance and transaction-based collateral. Real efforts are being made by the organization, however, and even though the past usage history of the export-oriented SBA programs is dismal, it now appears their various guarantee programs and especially the ERLC guarantee described below should become an increasingly viable source of financial support for the exporter. Special training is being provided to loan officers handling international loans. To be el

Agency for International Development (AID) Procurement Assistance SBA offers special help and performance guarantees through their 8(a) program to assist in procurement of AID contracts for overseas sales and services. This is accomplished within AID's OSDBU/MRC office and is detailed in Exporters-sources.com - index page - 13 under "The Agency for International Development" subheading.

SBDC/SBI Programs Business counseling and assistance are offered through Small Business Development Centers (SBDCs) and to some extent any of them may be capable of providing export business information and counsel. However, some SBDCs are now being organized specifically around an export orientation. SBDCs are most often found in colleges and universities, but not exclusively. The Small Business Institute (SBI) programs are confined to some 450 learning centers because they utilize business students who provide counseling, surveys, and strategic and feasibility studies under faculty supervision.

SCORE/ACE Programs Individual assistance and training is available through the dedicated Service Corps of Retired Executives (SCORE) whose members include more than 600 former exporters. The Active Corps of Executives (ACE) is a volunteer organization of more than 2,600 executives and provides a similar service. Many of these executives have had international trade experience and are pleased to impart their knowledge.

Office of International Trade The Office of International Trade offers many programs for exporters, such as: • Export Counseling: Through Export Counseling, individual counseling by international trade specialists is offered when available in the area. For this purpose it might be wise to investigate the counseling staff that is available from both the US&FCS and SBA if both offices are equally available to you. • Export Training: Export Training is generally offered by means of co-sponsorship with DOC and/or private sector organizations. • Legal Assistance: The Export Legal Assistance (ELAN) program offers free, initial consultations on the legal aspects of exporting through an arrangement with the Federal Bar Association by qualified attorneys in the International Law Council. • Export Information Program (XIS): The XIS provides data that is based on SITC product categories taken from U.N. data. Check for submission dateon this and, for that matter, all other sources of inf

Loans for Export SBA 7(a)l 6 Export Loan If the purpose of the loan can be shown to be for the acquisition or modernization of facilities for the production of goods or services for export, SBA's 7(a)l6 program applies and the Omnibus Trade Bill increased the loan limit to $1 million for export support. The firm must prove it will expand exports or it is being adversely affected by imports. No more than $250,000 of the eligibility under 7(a) 16 may be for working capital in contrast to facilities. Export Revolving Line of Credit Loan (ERLC) The Export Revolving Line of Credit (ERLC) program is called the 7(a) 14 loan and is available for pre-export financing purposes to develop foreign markets or to finance production primarily the latter. Insured foreign accounts receivable may be financed and used for collateral as well. The maximum guarantee is for $750,000 and a term of 12 months with opportunity for annual renewals up to 36 months. In whichever combination of these or othe

Regular Business Loan Programs Provide for loans or guarantees for the acquisition of land and building to 25 year terms, machinery and equipment to 10 years, and working capital to 7 years. The SBA guarantee for any loan mentioned here is for 85 percent, up to a maximum of $750,000, but SBA can guarantee 90 percent of loans under $155,000.

Small Business Answer Desk The Small Business Answer Desk is designed to provide information on specific issues and to refer inquiries to the SBA department or program officer who can best assist you. The answer desk can be reached at (800) 368-5855 or (202) 653-7561. The SBA was not established for any purpose of foreign trade, but today it also serves exporters through 10 regional offices across the United States with 107 regional, district, or branch offices in major cities. In addition, the Office of International Trade is a specialized source of information that is related to exporting. SBA is taking an increasingly active role in supporting and initiating export programs for small business. It sponsors free export counseling, seminars, conferences, and publications, in addition to financial assistance. Its export-oriented informational programs are provided through the Office of International Trade.

Small Business Administration (SBA) The Small Business Administration (SBA) offers a variety of programs to assist exporters. Some such programs are listed as follows:

City, county, academic, and port authority programs After understanding what the state has to offer, you should still take the time to check with the cities or counties within which you operate, as well as those more or less adjacent to you. The help available from a wide variety of agencies is too extensive to list, but here are some ideas to help you make sure you have investigated all possibilities. First, try the mayor's office, which will probably not only know what the city has to offer but most other government entities as well. If there is a world trade center near you, investigate their activities. They will also be knowledgeable about other programs in your area, which may include Centers for International Trade Development often situated in colleges or universities. Check also for local Small Business Development Centers (SBDCs) that may include international skills. In the case of counties, the help would most often be related to agriculture or an especially vital in

Current state programs States have found that they can successfully perform in new-to-export encouragement and counseling, trade lead distribution, trade promotion, foreign offices in key markets, and financial support. Trade promotion is a key activity and includes a variety of undertakings such as hosting overseas missions, presenting catalog shows, and facilitating arrangements for visiting foreign buyer delegations. A very popular and helpful form of promotion is in joint trade show pavilions to keep costs to a minimum and make it easier to undertake a first overseas showing. As states enter into partnership with Washington, DC, to provide a substantial boost to the federal effort, they expect the U.S. government to maintain or improve its existing efforts. However, there are warning signs that these expectations will not materialize and states should be alert to see that their congressmen are aware of this situation that threatens to neutralize state level expenditures and effo

State and other organizations offering export assistance STATES ACROSS THE NATION ARE NOW RAPIDLY IMPLEMENTING EXPORT SUPPORT programs in great variety, realizing that their exporters and industries need more help than can possibly be expected from the federal government. Report after report has confirmed that the U.S. Department of Commerce (DOC) programs are not all they might be. Among the major industrialized nations, the United States spends the least per capita to promote exports. Canada spent $21.44 per citizen in 1987, an amount that was 18 times the United States figure of $ 1.20. Whether analyzed in Gross National Product (GNP) on exports in dollars, or by figures based on the population, the answer is the same. Besides the budget problems, there have been organizational and planning problems. These problems became more acute as the budget became more restricted and the costs of the overseas posts grew as the relative value of the dollar fell. Many legislatures, as well as

Export Credit Office This is the office for administration of the financial export support programs of the Commodity Credit Corporation (CCC) and its administration of Public Law 480 (PL 480). The international financial programs of CCC, for trade finance support, tend to be buyer credit programs. The programs all have a government-to-government tilt involving determinations of country need and financial condition, as well as U.S. marketing objectives. In some aspects it is very concessionary, including humanitarian aid in the case of PL 480 and the long repayment terms of GSM-103. In these two programs it is more related to AID than Eximbank. As with all government programs, there is a tendency for them to evolve because of competition, budgetary restrictions, and reasons of state. While often buyer-originated, the programs can be utilized with exporter initiative, but this generally requires knowledge of the players and good advance planning. The Export Credit Office administers t

Commodity and Marketing Programs (CMPs) The CMPs office is in part equivalent to the US&FCS at DOC in terms of marketing assistance programs. The Foreign Market Promotion Programs division and the Agricultural Information and Marketing Service (AIMS) division have been combined under CMP with what is known as the "High-Value Products" division. High-value products are usually completely processed foods such as soup, chocolate, pasta, and so forth. The High-Value Products division's job is to support and assist the international marketing of such products that are largely branded and have a greater job impact because they combine agriculture with manufacturing. CMPs areas of focus break down as follows. Foreign Market Promotion Program The Foreign Market Promotion Program activity currently has a $30 million budget to support direct promotion of specific commodities through overseas trade fairs and allied activities. Agricultural Information and Marketing Service (

Office of General Sales Manager Division The Office of the General Sales Manager (OGSM) (for agricultural export promotion and export credit), who is also an associate administrator, administers the second major subdivision. This is the area that is most visible and useful to the agricultural exporter. It includes the Commodity Marketing Programs (CMPs) and the Export Credit Office for administration of the international export credit programs. An assistant administrator manages each office.

Foreign Agricultural Affairs The Foreign Agricultural Affairs office is USDA's own "State Department," with six world area officers located in Washington, DC, who may be contacted for initial orientation prior to direct contact with about 100 agricultural economists and trade specialists who are posted at about 70 U.S. embassies and consulates, covering 100 countries geographically. These overseas offices are comparable to the Foreign Commercial Service officers in the DOC. Their job includes global reporting, market development and expansion, detection of trade barriers, monitoring other nation's trade practices, and providing agricultural advice to the U.S. Ambassador in the area.

International Trade Policy This office encompasses agriculture's input into the General Agreement on Tariffs & Trade (GATT) and general policy issues as well as the General System of Preferences (GSP) and subsidy issues. It plays a major role in the President's U.S. Trade Representative Office (USTR). The first responsibility of the office is to make known USDA's position, relative to international policies. It has officers, divided into five teams by regions of the world, charged with the responsibility of knowing and reacting to the policies and trade practices of the other nations in that region.

International Agricultural Statistics The International Agricultural Statistics is responsible for foreign production estimates, export sales reporting and economic information compiled by DOC and the United Nations (U.N.). The Agricultural Product Reports help identify market opportunities for about 395 high-value and added-value products or product groups. The Country Agricultural Reports examine agricultural trade in 160 countries. For more information, contact their office at (202) 382-9509.

Foreign Affairs, Policy, and Statistics Divisions The Foreign Affairs, Policy, and Statistics Divisions make up the first subdivision, including the following offices managed by Assistant Administrators: International Agricultural Statistics, International Trade Policy, and Foreign Agricultural Affairs.

Foreign Agricultural Service (FAS) The Foreign Agricultural Service (FAS) responsibilities include administration of programs with grant or aid elements and supplement Eximbank's and OPIC's financial programs with a number of specialized financing programs for agriculture. FAS cooperates closely with ITA, even though some of their programs overlap and the agricultural exporter will do well to be informed of both structures.Knowing how the FAS is organized will enable you to understand its part in the overall functions of the USDA. The FAS is presided over by an Administrator, and is broken into two major subdivisions under Associate Administrators. They are the Foreign Affairs, Policy, and Statistics Division and the Office of General Sales Manager Division.

U.S. Department of Agriculture THE U.S. DEPARTMENT OF AGRICULTURE (USDA) HAS AN AGGRESSIVE EXPORT program. As with the Department of Commerce (DOC), the USDA has numerous subunits, one of which is the Foreign Agricultural Service (FAS). FAS is a lesser part of the USDA than ITA is of the DOC. The FAS is presided over by the Under Secretary for International Affairs and Commercial Programs. In addition to FAS, the secretariat includes the Agriculture Stabilization and Conservation Service (ASCS); the Office of International Cooperation and Development (OICD); and the management of the Commodity Credit Corporation (CCC), a wholly owned goverment financing corporation. ASCS activities include buying and storing crops. OICD specializes in development of poor countries and is in charge of the agricultural side of the Caribbean Basin Initiative (CBI). CCC, while active internationally through the GSM -102 and GSM-103 programs, PL 480 also has many major domestic financial responsibilities.

The National Oceanic and Atmospheric Administration (NOAA) The National Oceanic and Atmospheric Administration (NOAA) assists the seafood industry by improving access to markets in other countries and assists exporters in a variety of ways. Its National Marine Fisheries Service addresses worldwide trade-barrier problems affecting U.S. fishery exports. For more information, contact the NOAA office at (202) 443-8910.  tags marine fisheries service national oceanic and atmospheric administration national oceanic and atmospheric administration noaa national marine fisheries noaa office national marine fisheries service worldwide trade trade barrier seafood industry fishery information contact

Minority Business Development Agency (MBDA) The Minority Business Development Agency (MBDA) is a separate agency within the DOC and provides special assistance to minority-owned businesses and promotes their expansion. For more information, contact the MBDA office at (202) 377-2414. tags  minority business development  minority business development agency  business development agency  minority owned businesses  mbda  information contact  

U.S. Travel and Tourism Administration (USTTA) The U.S. Travel and Tourism Administration (USTTA) promotes U.S. exports of goods and services in tourism. For more information, contact the USTTA office at (202) 377-4904. tags  tourism administration  ustta  travel and tourism  information contact  

National Center for Standards and Certificates Information (NCSCI) The National Center for Standards and Certificates Information (NCSCI) is within the DOC's National Bureau of Standards (NBS), and is the government's storage center for both domestic and foreign standards-related information. U.S. exports must conform to foreign national requirements, standards, testing, and certification requirements. The NBS maintains a special "hotline" (301) 975 — 4041 with recorded messages of notifications that might affect your international business. For more information, contact the NCSCI office at (301) 975-4040. tags

National Technical Information Service (NTIS) Also part of the DOC, but under a different administrative division than the Bureau of Census, the National Technical Information Service (NTIS) is the goveminent research clearinghouse and gathers the information for the publishing of Market Share Reports and Country Market Surveys. The NTIS is responsible for coordinating complete or partial publishing in as many as 70 to 80 publications and organization newsletters around the country of the TOP leads, led by the Journal of Commerce. For more information call the Economic Bulletin Board (see Appendix M). While most of their data may be accessed through the DOC District Office, they may be contacted directly concerning further research details at: National Technical Information Service, U.S. Department of Commerce, Springfield, VA 22161, (703) 487-4650. tags  market share reports  economic bulletin board  technical information service  research clearinghouse  national technical inform

Bureau of the Census This is one of the major functions of DOC and is the principal gatherer of statistics, including all import and export statistics. The latter are obtained from the Shipper's Export Declaration. Most of their statistics that apply to exporting are utilized for trade analysis by the US&FCS, or other divisions of the ITA. The office of key importance to the exporter within the Census Bureau is the Center for International Research (CIR), which can be reached at (301) 763-2870. This organization gathers useful data for international marketing purposes on overseas demographic trends. This is contained in the International Data Base (IDB) and is divided into broad geographic areas: China, USSR, Europe, Asia, Oceania, Latin America, and Africa. The categories for data are numerous and include such statistics as infant mortality, migrations, marital status and family planning, literacy, and housing indicators. More information on this service may be obtained fro

Other government publications from the GPO Although not part of DOC, the GPO prints for DOC and many other organizations besides ITA, offering publications of immediate interest to exporters. They may be contacted by writing to the Superintendent of Documents, Washington, DC 20402, or by telephoning (202) 783-3238. The GPO will provide two free catalogs: U.S. Government Books, listing more than 1000 best selling titles and Government Subscriptions, a catalog of government periodicals. Publications of interest for the exporter include: • A Basic Guide to Exporting • Exporter's Guide to Federal Resources for Small Business • Standard Industrial Classification Manual • The Export Trading Company Guidebook • U.S. Export Administration Manual • Commerce Business Daily: A daily newspaper listing government procurement invitations and foreign business opportunities through the multilateral development banks. (See Exporters-sources.com - index page - 13.) • World Fact book: A fact

ITA publications The following publication can assist you in your exporting endeavors: • Business Americas: This publication is a biweekly magazine for the exporter. Available from: Government Printing Office (GPO), $40. • Foreign Economic Trends: This publication provides current business and economic data for individual countries. Available from: GPO, $55 annually or $1 per report. • How to Get the Most from Overseas Exhibitions: Available from: ITA, free. • Market Share Reports (Commodity Series): This publication compares the competitive position of U.S. and foreign exporters by commodity and provides data to evaluate overall market trend and potential. The reports include combined exports from 14 to 100 countries. Individual country reports are also available. Prepared by: the National Technical Information Service, $11 for each commodity. • Official U.S. and International Financing Institutions: A Guide for Exporters and Investors: Available from: ITA, $1.50. • Overseas B

District export councils An adjunct of the US&FCS district offices in particular and the ITA in general, the Secretary of Commerce appoints a cross section of seasoned export executives (numbering more than 1,800) from each DOC district to act as a sounding board for the export support needs of the district and to voluntarily provide counsel in limited situations as well as to increase the area's export awareness. Relative  export councils  export support  sounding board  secretary of commerce  cross section  adjunct  ita  

Assistance in organizing initial contacts The following are some key tools for use in organizing your initial contacts abroad: • Matchmaker Events: Such events are organized for brief and relatively inexpensive overseas visits to prospective foreign associates for a small business group or groups with common interests. (See Exporters-sources.com - index page - 12.) • Overseas Trade Missions: These groups of U.S. business persons missions are conducted on overseas visits to confer with influential foreign business and government representatives. Individual appointments will be arranged in the cities visited. (See Exporters-sources.com - index page - 12.) • Overseas Catalog and Video/Catalog Shows: These shows offer an inexpensive contact, organized by industry experts, who present your sales literature through a third party to foreign audiences in several countries. (See Exporters-sources.com - index page - 12.) • Foreign Buyer Program: This program offers trade shows in the Unite

Foreign contact search and evaluation The following is a list of pro grams and publications that can be used by exporters to further explain their customer possibilities. • Trade Opportunities Program (TOP): TOP provides sales leads based on contacts from overseas firms. (See Exporters-sources.com - index page - 9.) • Commercial News USA: This publication is a catalog published 10 times a year promoting the services and products of U.S. firms to more than 100,000 foreign buyers and government officials. In each issue there are sections devoted to three categories: 1) new products, 2) selected industry promotions, and 3) services, (see Exporters-sources.com - index page - 9.) • Agent/distributor service-. This service is a customized search by the foreign post to identify up to six prospects who have reviewed the inquiring firm's literature and have expressed interest. (See Exporters-sources.com - index page - 9.) • World Traders Data Reports (WTDR): The WTDR are customized re

Market research The following is a brief list of available market research services: • Export Counseling: Individual counseling is available with trade specialists at US&FCS district offices. (See Exporters-sources.com - index page - 3.) • National Trade Data Bank (See details in this exporters-sources.com - index page -) • Custom Statistical Service: Marketing data on individual products in more than 200 markets are available. (See Exporters-sources.com - index page - 7.) • Comparison Shopping Service: A comparison shopping service is performed in the field by the foreign service officers and their foreign nationals staff. (See Exporters-sources.com - index page - 7 and 9.) Relative  foreign nationals  comparison shopping service  trade specialists  statistical service  service marketing  individual products  foreign service officers  index page  market research services  national trade data bank  trade data bank  national trade data

A review of ITA services and publications Because of the importance of the International Trade Administration and its multiple uses to exporters, its services and publications are summarized below, together with the exporters-sources.com - index page - in EXPORTERS-SOURCES.COM - INDEX PAGE -where specific uses of the services are described. The International Trade Administration Enhancing America’s Global Competitiveness What is the International Trade Administration? The International Trade Administration (ITA) is charged with the mission of strengthening the competitiveness of U.S. industry, of promoting trade and investment, and of ensuring fair trade and compliance with trade laws and agreements. ITA creates opportunities for U.S. workers and firms by promoting international trade opportunities and by fostering a level playing field for American business. These activities are organized into four different divisions that comprise ITA:     * Market Access and Compliance

Import Administration The Import Administration unit provides the mechanism through which manufacturers or workers can request a determination as to whether they are victims of unfair trade practices, such as foreign subsidies or dumping. Should this be the case, and the International Trade Commission of the United States agrees, the U.S. government instructs the U.S. Customs Service to assess countervailing duties or other appropriate remedies. The Import Administration's duties include administering bilateral trade restraint agreements and similar arrangements. It also administers the ForeignTrade Zone program that is discussed in Exporters-sources.com - index page - 29 on "U.S. Custom Tariff Benefits." Call (202) 377-1780 for more information on the function of any of these sectors. Relative  unfair trade practices  u s customs service  custom tariff  import administration  trade restraint  administration unit  zone program  bilateral trade  international trade c

Trade Information and Analysis The Trade Information and Analysis office deals with matters that cut across industry sector lines, such as economic, trade, and industry analyses; investment and finance data; and U.S. and international statistics. The purpose of this office is to assist the U.S. businesses in their market planning and for use in export promotion and trade policy. The Trade Information and Analysis office can be reached at (202) 377-1316. The general information number for the Trade Development unit is (202) 377 —1461. See also Appendix E. Relative  sector lines  finance data  international statistics  industry analyses  e trade  office deals  economic trade  trade information  information number  export promotion  industry sector  appendix  

Office of Export Trading Company Affairs The Office of Export Trading Company Affairs' primary objective is to promote the formation of trading companies and administer the Export Trading Company Act of 1982. This office printed the Export Trading Company Guidebook and was responsible for the Partners in Trading Directory. In 1991 these were supplanted by a new version called the Export Yellow Pages. This time the publication has a private sponsor and advertising. It is distributed through the DOC district offices, free of charge and by means of the NTDB systems as previously mentioned. No one has been satisfied with any of the previous attempts and it is expected that this approach is an improvement. The Office of Export Trading Company Affairs can be contacted at (202) 377-5131. Relative  export trading company  company affairs  private sponsor  company act  attempts  objective  yellow pages

Office of Multilateral Affairs The Office of Multilateral Affairs can help firms with matters such as rights or benefits relative to the Organization for Economic Cooperation & Development (OECD), General Agreement on Tariffs & Trade (GATT), or Multilateral Trade Negotiations (MTN). It is responsible for coordinating with and serving an interagency policy role with the USTR for multilateral trade negotiations. It is also an active participant in the GATT. To reach the International Economic Policy unit, call (202) 377-3022. Relative  multilateral trade negotiations  international economic policy  development oecd  multilateral affairs  economic cooperation  ustr  gatt  interagency  tariffs  participant  

U.S. and Foreign Commercial Service (US&FCS) The U.S. and Foreign Commercial Service (US&FCS) is the unit most frequently used by exporters. It is responsible for the overseas trade officers at 126 foreign posts (formerly part of the State Department), representing 66 countries who are in touch with 48 DOC district offices plus 19 branches. The Omnibus Trade Bill intended to strengthen the US&FCS, but has not yet had much effect, beyond the excellent development of the National Data Bank (NTDP) with the exception of formalizing the unit by statute and placing a US&FCS officer in each multilateral development bank. The latter is intended to help American businesses make use of the export business development banks. (See Exporters-sources.com - index page - 13 on "International Bid Opportunities.") Every exporter has direct access to these DOC district offices, operated by the US&FCS, whose main objective is to assist and inform, whether you are a new-to-e

International Trade Administration (ITA) The International Trade Administration (ITA) is a vital instrument of the federal government. As an exporter, your primary focus in terms of government affairs as they apply directly to your business should be on the ITA, whose policies are developed and governed by the Under Secretary for International Trade. This administrator has a major effect on exporters and on our trade and economic relations with other countries. ITA arranges for programs to assist your export promotion efforts, develops information and statistics that make your own market research possible, determines the availability and effectiveness of our domestic trade specialists and overseas officers, and participates in formulating and imple-menting part of our foreign trade and economic policies in cooperation with the U.S. Trade Representative (USTR). There are no financing or financial assistance programs on the DOC menu. ITA is divided into four units, each administered b

U.S. Department of Commerce THE U.S. DEPARTMENT OF COMMERCE (DOC) ADDRESSES BOTH THE DOMESTIC and international commercial activities of the United States and is a very large and complex organization. The International Trade Administration (ITA) is responsible for the bulk of international commerce support except for agriculture, which is provided by the U.S. Department of Agriculture (USDA) and is taken up in Exporters-sources.com - index page - 43. There are a number of export-related activities for which ITA is not directly responsible, but is nevertheless involved in their coordination. In addition to ITA, the other DOC offices, agencies, or administrations of direct use to export interests are also presented here. Relative  international trade administration  export interests  department of commerce doc  complex organization  department of agriculture  international commerce  u s department  department of commerce  page 43  ita  index page  coordination  department of agricul

Investment mission program Investment missions are 5- to 10-day trips to target countries or key developing nations. OPIC usually plans four to five missions per year, well in advance, that represent an opportunity for an organized and informed visit in the appropriate situation. Missions include detailed briefings on the country's investment, economic, and political climate. The core of the mission, however, is individual business appointments arranged in advance to the investor's interest. OPIC was once well known for engineering multiplier programs and feasibility study grants. At this time, those programs have been set aside because of budgetary and priority reasons. Relative  investment missions  business appointments  investment mission  study grants  feasibility study  political climate  opic  developing nations  day trips  briefings  investor  

Opportunity bank The opportunity bank is a computerized database maintained by OPIC to match American investors with developing country projects. It currently has more than 1,000 overseas projects and 4,000 potential American investors on file. Most investors would be firms interested in joint ventures to increase their potential worldwide sales territory or improve their efficiency and competitiveness domestically and abroad; perhaps even to secure a necessary component or raw material for their American production.Investor information service The investor information service is a series of kits on OPIC countries that are available by individual country or by regions. It is an excellent way to study the potential in an area for joint ventures or investment opportunities at a very reasonable cost. Relative  american investors  country projects  overseas projects  sales territory  opic  necessary component  worldwide sales  developing country  raw material  joint ventures  competi

Small contractor guarantee program If the contractor can be qualified as a small contractor (not among the "Fortune 1,000"), the small contractor guarantee program addresses a bane of small business—getting a guarantee for the bank to support a standby letter of credit to be used as a performance bond. In some cases, this might permit utilization of at least part of the down payment for working capital purposes instead of being held as collateral for the standby letter of credit so often necessary to validate the underlying contract. OPIC's guarantee to eligible financial institutions covers all risks up to 75 percent of the credit and is unconditional. For further protection, the contractor can apply for the 90 percent coverage afforded by the contractor's insurance policy previously described. Presumably, this guarantee would also be available for relatively short terms. Relative  standby letter of credit  guarantee program  capital purposes  performance bond

Contractors and exporters insurance program The contractors and exporters insurance program is a specialized coverage insurance program to help protect an American contractor or exporter from wrongful action by government agencies, and to a lesser degree private buyers, in the developing world. The program represents an exception to OPIC's usual emphasis on medium- to long-term commitments and coverage can be had for a minimum of 6 months. It is intended to cover: • Disputes pertaining to the underlying contract and conflicts over payment for goods or services including change orders and cost overruns • Wrongful calling of standby letters of credit supporting bid, performance, and advance payment guarantees • Loss of assets because of inconvertibility, confiscation, and political violence OPIC's coverage is for 90 percent of the financial loss in all three cases. In wrongful callings or arbitrary drawings and disputes coverage, there must be a decisional procedure describ

International leasing programs The international leasing programs are actually a twin program, comprised of both insurance and financial assistance. The insurance portion is tailored alongOPIC's typical insurance approach to cover losses of the insured lessor because of currency inconvertibility expropriation, or political violence. It can be applied to cross-border operating or capital lease transactions. It also can cover equity investments in offshore leasing companies, management and maintenance agreements, and consigned inventory. The financial assistance portion involves guaranteeing loans to foreign leasing companies in which there is a significant American interest for terms in the range of 4 to 7 years. Direct loans are reserved for small business and cannot exceed SI million at a fixed rate, priced at prevailing treasury rates of comparable maturity. A first lien on the equipment itself can be the primary security. Eligibility and general guidelines are typical of the

Eligibility requirements Eligibility requirements are similar to those for OPIC insurance and there is no distinction between direct and guaranteed loans. Again, the project must be sound and conducted by management with a proven track record in closely related areas. A wide range of enterprises are eligible, but projects involving the poorer countries or American small businesses have preference. The project can be wholly owned or a joint venture with local citizens, but at least 51 percent of the voting shares should be held by privately owned firms or by individuals. An exception to this can be made if there is a contract to the effect that management will stay in private hands. However, wholly owned government projects are not eligible. Sound debt to equity ratios are required. Typically, OPIC likes 60/40 debt to equity ratios or better, although there is some flexibility. OPIC must feel assured of a satisfactory financial plan and adequate funding to assure completion, and it a

Guaranteed loans Guaranteed loans are for major corporations not eligible for direct loans under the OPIC charter. They might also be utilized by small businesses investing in large projects. Typically such loans will be at a fixed interest rate in excess of $1 to $25 million, or in some cases to $50 million for a term in excess of 3 years. Guaranteed Loan Systems Requirements This is a functional requirements document for guaranteed loan systems requirements. Functional requirements for direct loan systems are contained in a separate JFMIP requirements document. This is one of a series of functional systems requirements documents published by the Joint Financial Management Improvement Program (JFMIP) on Federal financial management systems requirements. All of the JFMIP Federal Financial Management System Requirements (FFMSR) series of documents should be considered together when determining how best to use information and supporting services to meet the financial managemen

Direct loans The direct loans program is limited to projects sponsored by small business and generally ranges in amounts from $200,000 to $4 million from OPIC's own funds. While OPIC cannot normally invest in equity shares of a venture, it does at times loan through convertible debt instruments with profit participation features. This financial structure strengthens the venture's equity base; might assist in achieving some local ownership by sale of the instruments to host country citizens; and increases OPIC's yield to compensate for the risks in its own portfolio. Direct Loans are low-interest loans for students and parents to help pay for the cost of a student's education after high school. The lender is the U.S. Department of Education (the Department) rather than a bank or other financial institution. With Direct Loans, you     * Borrow directly from the federal government and have a single contact-the Direct Loan Servicing Center—for everything related to

Investment financing programs OPIC provides medium- to long-term loan guarantees, or even direct loans to ventures that involve significant equity and management participation by American business. The loans are available principally for project financing, and OPIC's participation is based primarily on the economic, technical, marketing, and financial soundness inherent in the project. Since it is nonrecourse financing, there must be an adequate cash flow to pay all operational costs, to service all debt, and to provide the owners with an adequate return on investment. In such project situations, assuming the know-how and experience of the project directors is evident, and sponsors need not pledge their own general credit. OPIC must satisfy itself that the financial plan includes an agreement that provides for unforeseen events, such as cost overruns, to assure project completion. Therefore, the financial capability to perform under the agreement must be assured. When project fi

Investment insurance programs OPIC's largest program is its investment insurance program that covers against the risks of: • Inconvertibility of currency-including the inability to transfer local currency into U.S. dollars as a result of lack of foreign exchange or adverse discriminatory exchange rates or laws; it does not protect against devaluation or exchange rate fluctuations • Expropriation-includes confiscation or nationalization, plus the more difficult situation of dealing with a set of actions whose cumulative effect is to deprive investors of their fundamental rights associated with the investment • Political violence (e.g., war, revolution, insurrection, civil strife)-includes physical damage to tangible assets as well as lost income resulting from interruption of operations caused by political violence Insurance premiums are based on two rates —the rate for the current amount selected by the insured or the effective insurance and standby rate insurance that is sim

Overseas Private Investment Corporation THE OVERSEAS PRIVATE INVESTMENT CORPORATION (OPIC) CAN BE VERY USEFUL when dealing with developing countries. It is unlike any other federal agency in its entrepreneurial approach. With the Agency for International Development (AID) operating mostly on a government-to-government basis, in 1971 it was felt a separate, business-oriented organization should exist to assist American business-people and investors interested in doing business in friendly Third World developing nations. OPIC's operations are restricted to this area of some 100 countries. Organized as a self-sustaining corporation, OPIC received only start-up funding, which has been repaid. Its purpose is to promote economic growth in developing countries by encouraging American private investment in those nations. As in the case of Eximbank, it enjoys the "full faith and credit" backing of the U.S. government. Its primary functions are project-related medium- to long-te

Private Export Funding Corporation (PEFCO) Although a separate organization, the Private Export Funding Corporation (PEFCO) is closely related to Eximbank and is mentioned here to round out the Eximbank picture and to cover all the facilities. PEFCO serves as a supplemental source of long-term financing for foreign buyers of American exports. It also has a new Note Purchase Facility to assure liquidity for Eximbank guaranteed medium-term promissory notes. It is a private corporation owned by a number of banks and 7 industrial corporations. PEFCO obtains the money it lends by selling debt obligations that are guaranteed by Eximbank. PEFCO supplements fixed-rate financing funds for a project only when its participation exceeds $ 1 million and the term exceeds 5 years. Typically PEFCO would be involved in combination with private banks and Eximbank, accepting middle maturities longer than the banks and shorter than Eximbank. Because it is a private organization and fairly unstructured,

Foreign versions of Eximbank Keep in mind when considering possible uses of Eximbank facilities and the limitations imposed on you by the foreign content rules, that many other nations have similar programs. Just as Eximbank makes direct loans to foreign buyers, you might utilize another country's facility in the course of your own overall international trade activities. Such foreign organizations can support you if you have an overseas subsidiary, a joint venture, or are using a substantial amount of that country's manufacture in a product you are producing for a third country. In fact, some countries running a serious trade deficit with the United States are using their export-import bank facilities to help to correct this serious geopolitical problem. The major examples are Japan, Taiwan, and Korea. Only certain products are eligible, but they represent broad and important export areas, except in the case of Korea, where only raw materials are currently emphasized. Very