GE Says 500 Jobs Leaving US Over Export-Import Bank Standoff

15 Sep 2015 | Author: | No comments yet »

500 GE Jobs at Risk Since No Ex-Im Funding.

Basic Electrical Co. might transfer as much as 500 American jobs abroad as a result of Congress didn’t renew a authorities program that permits overseas corporations to borrow cash to purchase U.S. merchandise. General Electric Co. will move around 500 U.S. jobs overseas to avoid losing business to foreign rivals, a decision the company said was prompted by the lapse of the U.S.

Export-Import Bank, is moving 500 jobs to France, Hungary and China after Congress halted the agency’s ability to offer new financing. “We’ve got $11 billion of active tenders that require some form of export credit financing,” GE Vice Chairman John Rice said Tuesday in a telephone interview. “We’ve got to start making some choices about where those products will be manufactured in order to qualify for export credit financing. Frankly, we’ve been pushed to do this.” Positions now in South Carolina, Maine, New York and Texas, including some Houston-based packaging operations for gas turbines, are being shifted, GE said. For months, GE GE 1.84 % has said that the failure to reauthorize the export financing agency, which congressional Republicans have singled out as an example of corporate welfare, would force the company to move jobs overseas or risk losing contracts for turbines, power projects and other industrial equipment. The corporate stated it reached an settlement with the French export credit score company to offer a line of credit score for international energy tasks.

GE has been threatening such a move for months as it urges lawmakers to revive the agency, which provided almost $1 billion in credit assistance to the company’s international customers last year. Executives say that the company is bidding on $11 billion worth of projects, mostly in developing nations, and that bids won’t be entertained if they aren’t sponsored by an export credit agency. The 81-year-old Ex-Im bank provides loans, credit guarantees and insurance to aid sales by U.S. companies including Boeing and Fairfield, Connecticut-based GE.

The bank’s charter expired June 30 when Republican members of Congress, who say Ex-Im benefits only a few large corporations that don’t need government assistance, blocked a reauthorization vote. While about 55 percent of GE’s 305,000-workforce was outside the U.S. at the end of 2014, the shifting of domestic jobs is a sensitive political issue.

As part of that $17 billion acquisition, GE has promised to add 1,000 new jobs in France, where the company already maintains a major power turbine production facility in the town of Belfort. GE has projected it can generate $3 billion in annual savings by consolidating the operations of its power business and Alstom, including by closing factories and reducing the company’s workforce. The Export-Import Bank requires the vast majority of production and jobs for deals that it finances to be located in the U.S., and most other export credit agencies have similar requirements. In July, some 64 senators voted for an amendment to reopen the bank, but conservative Republicans who control key leadership positions have so far prevented a vote in the House of Representatives. Critics of the bank say Washington shouldn’t be picking winners and losers, and some have said that any hardship for businesses is part of a necessary recalibration.

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