Arkansas' Top Exporters Recognized, Officials Call for Ex-Im Bank Renewal

Arkansas' Top Exporters Recognized, Officials Call for Ex-Im Bank Renewal

The Arkansas District Export Council recognized winners of the 2015 Governor's Award for Excellence in Global Trade at its annual awards luncheon Tuesday from the Governor's Mansion, while Arkansas small business owners and an official with the U.S. Export-Import Bank called for renewal of the bank's charter.

Arkansas export award winners for 2015 are:

  • Large Manufacturer: Georg Fischer Harvel LLC, Little Rock, manufacturer of plastic pipe and fittings for the transportation of water and gases;
  • Medium Service Provider - Knesek Guns Inc., Van Buren, specialty firearms distributor;
  • Small Manufacturer - Galley Support Innovations Inc., Sherwood, manufacturer of interior hardware for trains, plains and yachts, which recently announced a major expansion;
  • Small Service Provider - Jobco Inc., Fort Smith, industrial equipment supplier;
  • Rising Star - Collective Bias Inc., Rogers, producer of shopper-related social media content.

Harvel, based in Easton, Pennsylvania, operates a major facility in Little Rock and exports to 50 international markets. It counts 20 percent of its gross revenue from exports.

Knesek ships to 76 countries (out of roughly 220 countries and territories across the globe), while GSI, still new to exporting, ships to eight international markets accounting for 20 percent of its total sales.

GSI co-founder and CEO Gina Radke said she expects exports to account for 50 percent of sales in the next 12 to 24 months.

An underlying theme to the conference was the future of the U.S. Export-Import Bank. Recent political momentum has put its future in doubt. The Ex-Im Bank provides foreign buyer financing, working capital for small businesses and export credit insurance.

Fred Hochberg, Ex-Im chairman, recently visited Little Rock and toured the Alexander facility of laser manufacturer Power Technology Inc., an Innovate Arkansas client firm that ships its products to 42 international markets. Hochberg was scheduled to testify before Congress this week which prevented his attending Wednesday's luncheon.

William Burgess of PTI chairs the ADEC, one of 59 such volunteer-led councils under the umbrella of the U.S. Department of Commerce.

Wanda Felton, vice chairman of the Ex-Im Bank, delivered the luncheon's keynote address in Hochberg's place and stressed the importance of renewing the bank's charter, which expires at the end of June unless Congress reauthorizes it.

Felton said Ex-Im operates at no cost to taxpayers and has returned roughly $200 billion back to the U.S. Treasury.

She said the trans-Pacific region that includes China will produce 3 billion middle-class consumers in the next 15 years.

"That's a staggering number and American companies have to get their fair share of those opportunities," she said.

Ex-Im lists 44 Arkansas companies as exporters, and they've shipped $778 million in goods and services since 2007. Since 2009, Arkansas companies have exported $657 million worth of goods and services.

Burgess said one in five jobs in Arkansas, roughly 320,000, are tied to exports.

Total U.S. exports were valued at $2.3 trillion in 2014, ranking the country second behind China.

Hochberg said on his Little Rock trip that China's own export bank has funded more transactions in the last two years than its American equivalent has in its entire 81-year existence.

"This debate about renewing the charter is being used by other countries against our companies," Felton said. "We're in a battle for market share with other countries. Our companies can compete and win when the rules of engagement are fair and transparent. Our companies can't compete against foreign governments."

Felton said Ex-Im tries to ensure that level playing field and eliminate financing as a barrier to exporting. Critics of the bank believe it provides too much credit assistance to big corporations and simply isn’t necessary.

State Rep. Warwick Sabin, who represents midtown Little Rock in the state legislature and is director of the Arkansas Regional Innovation Hub, attended the awards ceremony and said the bank is a critical resource for small businesses that wouldn't otherwise be able to access the capital necessary to compete in the global marketplace.

"Reauthorization of the Export-Import Bank has never been controversial, and it shouldn't be now," he said. "The vast majority of U.S. exporters are small businesses, and they need to utilize the kind of credit Ex-Im provides in order to be competitive with other nations that aggressively leverage their own similar agencies. Ex-Im is not a drain on taxpayers because it is self-supporting, and its default rate is impressive at under 2 percent."

Small business owners in attendance on Wednesday said the bank is indeed a necessary resource for small businesses that want to export. Burgess, whose company has been exporting for decades, said the public groundswell of support for letting the Ex-Im Bank's charter expire is based on a "skewed view."

"It's never been controversial until now," he said. "For every one transaction the bank makes with a large corporation, there are thousands made for small businesses."

Burgess said despite the controversy, he believes the charter will be renewed, likely with modifications.

Radke said GSI hadn't yet used Ex-Im Bank services but expected that it would within the next year as the company increases its international sales. Allowing the charter to expire would put American manufacturers at a major disadvantage, she said.

The event was presented by Expeditors, which assists businesses globally with exporting logistics. It's based in Washington but last year opened an office in Little Rock. Gov. Asa Hutchinson continued the tradition of the governor's office hosting the event from the mansion's Great Hall, but Hutchinson was out of state and couldn't attend in person.

Two of the state's biggest exporters, Tyson Foods and Riceland, donated the luncheon's main ingredients.

Burgess said the application process for the 2016 awards is underway, and the council always is looking for new members. Current council officers are:

  • Burgess, chair;
  • Vice chair Greg Matheny, senior international account executive for FedEx Services;
  • Treasurer Paul Latture, retired, Little Rock Port Authority;
  • Marketing Chair Christine Russell, district sales executive, Expeditors International;
  • Legislative Chair Susie Marks, senior VP of programs for the Arkansas State Chamber of Commerce;
  • Executive Secretary James Aardapel, director of the U.S. Commercial Service Export Assistance Center for Arkansas.

Export award winners are selected by a committee made up of ADEC members based on criteria that includes innovation, percentage of export sales and increase in export sales.