Book Description

In response to a congressional request, GAO reviewed the implementation of the Export Trading Company Act of 1982 and analyzed: (1) congressional and executive branch expectations for the export trading companies (ETC); (2) the number of ETC formed and their activities; (3) the number and effectiveness of the antitrust exemptions the Department of Commerce granted; (4) whether ETC have helped to lessen the trade deficit; and (5) reasons advanced for establishing such companies. GAO found that: (1) Congress formed ETC as a mechanism to reduce or eliminate perceived barriers to U.S. exports; (2) as of October 1985, 57 companies had received certificates of review extending antitrust protection to their export trade activities, and 40 bank holding companies had formed ETC; (3) over half of the 23 companies GAO contacted said that they had received benefits such as publicity, credibility, and image enhancement, but only 2 indicated that they had increased their trade volume as much as anticipated; (4) it is too early to evaluate the legislation's achievements or to judge U.S. firms' efforts to penetrate new markets because the economy in general, third world debt, U.S. dollar value, and the worldwide recession affect the trade deficit; and (5) bank holding companies are expected to compete with similar foreign-owned institutions and afford U.S. commerce a means of exporting at all times.