AMERICAN multinational conglomerate General Electric (GE) has warned that it will move manufacturing to Canada and Europe if the controversial Export-Import Bank closes as Republican cost-cutters want.
Government cost-cutters want to close state-owned Ex-Im bank, arguing that it provides "corporate welfare" to big companies, including GE and Boeing.
The charter of the Ex-Im Bank, the federal credit agency, will expire on June 30, blocking it from writing new loans and trade guarantees, unless Congress acts to reauthorise it.
GE chief executive Jeff Immelt also warned that that US economic influence will wane in the world if Congress votes down the major Pacific-rim trade pact, Reuters reports.
Speaking to business leaders at a luncheon of the Economic Club of Washington, Mr Immelt said US companies need market access and financing tools to help level the playing field in an "economic war for exports".
Without ExIm, major export deals will be lost to China, Japan and Europe, where there is aggressive government support for exports, he said.
Since GE does not want to lose that business, it will move production to countries where it can take advantage of export credit agency support.
"Good GE jobs in the United States will be moved to Canada and Europe. That's a mighty high price to pay for ideological purity," Mr Immelt said.
He also said Democrats needed to be more confident that trade deals will help generate well-paying jobs in the United States, adding that a number of GE's unionised plants export the most of their products.
Passing both the "fast-track" trade authority package and reauthorising the ExIm bank would send a strong signal to global customers that the United States intends to stay a leader in exports for the long term, Mr Immelt said.
Source : HKSG.