Mississippi catfish for Left Bank dining - US gives a hand
Mark Freeman wants to sell Mississippi farm-raised catfish - in Paris and Singapore. He is one of many business people eager to sell the products and services of small to medium-size American companies overseas. And Uncle Sam, faced with a chronic and growing international trade deficit, is helping them.
Business executives and bankers are starting to take advantage of the 1982 Export Trading Company Act, Congress's answer to what it regarded as two major barriers to United States export trade: lack of export capital and fear of antitrust suits blocking cooperative efforts to market American products abroad.
For the most part, American export trade has been the province of corporate giants. By one estimate, 85 percent of the country's exports of manufactured goods are made by just 1 percent of its manufacturers. Most smaller businesses have not been able to spend the time or money locating customers in distant and unfamiliar markets. Independent trading companies have tended to be small, highly specialized, and unable to undertake expensive campaigns overseas.
By contrast, in countries such as Japan much export trade is conducted through huge trading companies which purchase indigenous products and resell them abroad, taking advantage of marketing leverage and economies of scale derived from their size.
Perhaps the most important section of the Export Trading Company Act authorizes bank holding companies (but not individual banks) to invest up to 5 percent of their consolidated capital and surplus in export trading companies (ETCs). Such investments had been prohibited by federal laws restricting the extent to which banks could engage in nonbanking commerce.