International Trade Programs 2010 EntrepreneurshipPresentation Transcript
International Trade Programs
Helping you start, grow and succeed
WHAT IS THE SBA ?
Small Federal Government Agency
Established by Congress in 1953
Aid, counsel and assist Americans start, operate, and expand their businesses
Provide access to capital, counseling and training, and increase federal procurement opportunities
SBA is primarily a guarantor of loans made by private and other institutions.
The SBA does not offer grants to start or grow small businesses.
How Important Are Small Businesses to the U.S. Economy?
Represent 99.7 percent of all employers
Employ half of all private-sector employees
Generated 2/3 of net new jobs annually over the last decade
Are employers of 39 percent of high-tech workers (such as scientists, engineers, and computer workers)
National Export Initiative
Double Exports in 5 years, create up to 2 million jobs
3 Main components
Expand trade advocacy
Increase access to credit (trade finance)
Remove trade barriers
National Export Initiative
Identify SMEs with export potential
“ Have you thought about exporting?”
Prepare SMEs for exporting
SCORE, SBDCs, WBCs
Connect SMEs with actual trade opportunities
Collaborate with other federal agencies on trade missions, etc.
Support SMEs with export financing
Export Express, EWCP/Ex-Im Co-guarantee
Banks: Regional and Local Community
State and City
U.S. Government International Agencies
U.S. Commercial Service
Overseas Private Investment Corporation (OPIC)
U.S. Export-Import Bank (Co-guarantee)
U.S. Department of Agriculture/Commodity Credit Corporation
SBA Loan Programs for Exporters
Export Working Capital Program (EWCP)
SBA-EXIM EWCP Co-Guarantee Program
Export Working Capital Program
$1.5 Million is maximum SBA guaranteed portion
Single Project or Revolver
Quick turnaround time
Company meets SBA size standards
Based on NAICS
Manufacturing: under 500 employees
can be as high as 1,500 employees
Ex-Im has no restrictions for size.
Product is titled and shipped from U.S.
No U.S. content requirement, Military OK
In business 12 months or proven expertise
Other SBA eligibility provisions
Criminal History, Previous loss to govt. etc.
Export Working Capital Program Eligibility
EWCP - Indirect Exports
Applicants who produce products or services that enter into the export channel but do not directly export their products are eligible for EWCP financing
Manufacturers using an Export Trading Company
Suppliers to other domestic manufacturers
Requires certification from domestic customer that goods are in fact being exported.
EWCP Use of Proceeds
Loan proceeds to acquire/produce goods or services for export, the accounts receivable of such foreign sales or standby letters of credit.
Labor and Material costs
Foreign Accounts Receivable financing
CO-GUARANTEE BETWEEN SBA AND THE U.S. EXPORT IMPORT BANK
Max loan amount of $2 million
SBA underwriting rules apply
SBA guarantee fee at 0.25% will apply
Longer than 12 months fee eliminated (temporarily as a result of Stimulus Package)
ExIm requirement for 51% domestic
content must apply
ExIm ban on military goods will apply
EWCP - How to Apply
Apply with a commercial loan officer at your existing bank. The Bank will forward your application to SBA for approval if SBA support is needed for the transaction.
Maximum loan amount $250,000
applicant in business for at least 12 months
proceeds for developing or expanding export markets
Maximum loan guarantee coverage
90% as a result of American Recovery and Reinvestment Act
normally 85% Up to $150,000 and 75% up to $250,000
Minimizes Use of Government Forms and Procedures
Streamlines Processing and Costs of Smaller Loan Transactions
Lenders Granted Expanded Authority and Autonomy
Finance export development activities
Participation in a foreign trade show
Translation of product literature for foreign markets
Provide transaction-specific financing for overseas orders
Provide revolving lines of credit for export purposes – term may not exceed five years
Finance standby letters of credit used for either bid or performance bonds
EXPORT EXPRESS CAN HELP
www.sba.gov/oit A free resource guide that provides a comprehensive guide to exporting.
http://www.ita.doc.gov/media/Publications/abstract/trade_finance_guide2008desc.html Trade Finance Guide: A Quick Reference for U.S. Exporters 2008 designed to help small and medium-sized enterprises learn the basics of trade finance. Turn export opportunities into actual sales and achieve the ultimate goal of getting paid -especially on time. Concise, two-page chapters offer the basics of numerous financing techniques, from open accounts, to forfaiting, to government assisted foreign-buyer financing. Trade Finance Guide