[Senate Hearing 111-178] [From the U.S. Government Publishing Office] S. Hrg. 111-178 KEEPING AMERICA COMPETITIVE: FEDERAL PROGRAMS THAT PROMOTE SMALL BUSINESS EXPORTING ======================================================================= HEARING BEFORE THE COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP UNITED STATES SENATE ONE HUNDRED ELEVENTH CONGRESS FIRST SESSION __________ JUNE 30, 2009 __________ Printed for the Committee on Small Business and Entrepreneurship Available via the World Wide Web: http://www.access.gpo.gov/congress/ senate U.S. GOVERNMENT PRINTING OFFICE 53-008 PDF WASHINGTON : 2009 ----------------------------------------------------------------------- For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC 20402-0001 COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP ONE HUNDRED ELEVENTH CONGRESS ---------- MARY L. LANDRIEU, Louisiana, Chair OLYMPIA J. SNOWE, Maine, Ranking Member JOHN F. KERRY, Massachusetts CHRISTOPHER S. BOND, Missouri CARL LEVIN, Michigan DAVID VITTER, Louisiana TOM HARKIN, Iowa JOHN THUNE, South Dakota JOSEPH I. LIEBERMAN, Connecticut MICHAEL B. ENZI, Wyoming MARIA CANTWELL, Washington JOHNNY ISAKSON, Georgia EVAN BAYH, Indiana ROGER WICKER, Mississippi MARK L. PRYOR, Arkansas JAMES E. RISCH, Idaho BENJAMIN L. CARDIN, Maryland JEANNE SHAHEEN, New Hampshire KAY HAGAN, North Carolina Donald R. Cravins, Jr., Democratic Staff Director Wallace K. Hsueh, Republican Staff Director C O N T E N T S ---------- Opening Statements Page Landrieu, The Honorable Mary L., Chair, Committee on Small Business, and a United States Senator from Louisiana........... 1 Witness Testimony Gordon Mills, Karen, Administrator, U.S. Small Business Administration................................................. 4 Kirk, Hon. Ronald, Ambassador, United States Trade Representative 10 Hochberg, Hon. Fred P., Chairman and President, Export-Import Bank of the United States...................................... 16 Sefcik, Patricia, Acting Deputy Assistant Secretary, Domestic Operations of the U.S. and Foreign Commercial Service, International Trade Administration, U.S. Department of Commerce 25 Schreiber, Eugene J., Managing Director, World Trade Center of New Orleans.................................................... 42 Simek, Diana, Vice President for Business Development, Ark-La-Tex Regional Export and Technology Center, Inc., and Manager, Metro/Regional Business Incubation, Shreveport, Louisiana...... 54 Castro, Wilma, Owner, International Export Sales, L.L.C., on behalf of the Louisiana District Export Council, St. Rose, Louisiana...................................................... 62 Hingle, Jerry, Executive Director, Southern United States Trade Association.................................................... 67 Alphabetical Listing and Appendix Material Submitted Castro, Wilma Testimony.................................................... 62 Prepared statement........................................... 64 Hingle, Jerry Testimony.................................................... 67 Prepared statement........................................... 69 Hochberg, Hon. Fred P. Testimony.................................................... 16 Prepared statement........................................... 19 Kirk, Hon. Ronald Testimony.................................................... 10 Prepared statement........................................... 14 Landrieu, Hon. Mary L. Opening statement............................................ 1 Questions for the record..................................... 88 Mills, Hon. Karen Gordon Testimony.................................................... 4 Prepared statement........................................... 7 Schreiber, Eugene J. Testimony.................................................... 42 Prepared statement........................................... 45 Sefcik, Patricia Testimony.................................................... 25 Prepared statement........................................... 27 Simek, Diana M. Testimony.................................................... 54 Prepared statement........................................... 56 KEEPING AMERICA COMPETITIVE: FEDERAL PROGRAMS THAT PROMOTE SMALL BUSINESS EXPORTING ---------- TUESDAY, JUNE 30, 2009 United States Senate, Committee on Small Business and Entrepreneurship, New Orleans, LA The Committee met, pursuant to notice, 1:06 p.m., in the Port of New Orleans Auditorium, First Floor, 1350 Port of New Orleans Place, New Orleans, Louisiana, Hon. Mary L. Landrieu (chairman of the committee) presiding. Present: Senator Landrieu. OPENING STATEMENT OF THE HONORABLE MARY L. LANDRIEU, CHAIRMAN, AND A UNITED STATES SENATOR FROM LOUISIANA Chair Landrieu. I would like to thank our witnesses who are here today. I am honored as the Chair of this committee that you would accept the invitation to testify. I also want to particularly thank the Port of New Orleans for hosting us. This is a very appropriate venue for the subject of this hearing on literally the shores of the greatest river system in North America. Let me thank the port and all of its employees for hosting us today. As I said, it is no coincidence that we chose this location as the site of our hearing. This port sees more goods leaving its docks each day than almost anywhere else in the nation. It pumps $882 million into Louisiana's economy and sustains more than 160,000 jobs. The reality is, Louisiana's ports, not just the Port of New Orleans, but the combined sister ports of South Louisiana, are America's ports and the gateway to the world. We are literally a main artery, if not the main artery, of our nation's commerce. We are home to five of the country's top 13 ports exporting more than $42 billion in goods last year alone. We send everything from sugar to oil and receive steel and goods from all over, over 200 countries worldwide. But the recession has caused challenges. The recovery is still underway from Katrina, Rita, Gustav, and Ike, major storms that have had a major impact on this region. We are still having challenges associated with those events. With cash registers not ringing like they used to, exporting has become one solution for small businesses looking to survive and grow, like Xenetech, who is here today with us. Guy Barone, I had the pleasure of speaking with him last night. Guy is the Chairman is the State's District Export Council. With the help of SBA and other Federal programs, Guy's family-owned business of just 21 employees ships goods to nearly 7,000 customers around the world, customers as diverse as Carnival Cruise Lines, NASA, and the Egyptian Army. Most recently, he supplied the engraving equipment to the company that provided the national championship trophy to our LSU Tigers last week. We are very proud of our Tigers and very happy the business that manufactured the trophy is right here in Louisiana. Xenetech and small businesses like it across the country have not only used exporting to weather the economic storm, they are proving that whatever helps our entrepreneurs helps our entire economy. Last year, $70 billion in exports maintained or created 600,000 high-paying American jobs. One of the successful exporters here today is Ralston Pittman Cole, who was recently named Louisiana's Small Business Exporter of the Year for his work at EMD Services International. Ralston, Guy, and others like them are helping our country grow out of this recession. Small businesses make up nearly 85 percent of the exporters in the State, 97 percent State-wide. I want to call your attention to Chart Number 1, which shows how we have got a long way to go. The percentage of small businesses that export are one percent of all small businesses, so they are in the mighty few. That gives us a great opportunity to grow and to help small businesses become the exporters that we believe they can be. The number of big businesses in the other chart are represented in three percent. The number of small businesses that export in the country, according to our data, is 239,000. So small businesses make up the greater portion of exporters, but they are still just a small percentage of small businesses that are actually exporting. So there is great room for growth and that is part of what our field hearing is about today. These small businesses have told me that the programs and services of the Small Business Administration and other Federal agencies are helpful, but we can do more. They have told me that better coordination and improvement of our programs are needed. But perhaps most importantly, we need to understand the root of the problem. The tools we have today help solve problems caused by inequitable rules created during trade negotiations. These barriers, like burdensome regulations, excessive reporting requirements, and unfair tariffs, force small businesses to act like big businesses, which they can't. They can be a business. They can be successful. They can't be big if they are small. In healthy times, the successful business can try to handle these situations. But when a devastating storm or groups of storms or levees that break occur, or when a global recession sets in, these challenges become almost insurmountable. So going forward, we need to be more proactive by ensuring that unfair trade rules and regulations don't stand in the way of our small entrepreneurs. This is why we are here today, to discuss these barriers and propose possible solutions. Some of the problems I have seen myself, and I hope some of the witnesses here will elaborate on some of the challenges and express their views about some of the proposed changes in terms of their new advocacy positions. With more than 19 Federal agencies involved in trade, small exporters often don't know where to turn for help or even that help is available. It is time we bring small business trade to the forefront. My committee has direct jurisdiction over one of these agencies, the Small Business Administration. I have been pleased that Administrator Mills has been with me all day this morning and part of yesterday touring the region and I will be anxious to hear more from her in just a moment. But I have been extremely impressed with her commitment and her concern and her ideas about what can be done through the SBA. We will also take a hard look at other agencies that are here representing Commerce and independent agencies that I would like to work strongly with them, as well. I, along with my Ranking Member on the committee, Senator Snowe, and Chuck Schumer from New York, who has also been very active in this area, have called for an Assistant Trade Representative focused solely on small business within the Office of our U.S. Trade Representative, and we are honored to have the Honorable Ron Kirk with us today. This advocate would be in the room supporting small business during trade negotiations. We are hopeful that we could move in that direction. It is also refreshing to have a strong partner in the White House and it has been a pleasure to work with the Administrator, as I have said before, earlier in my testimony. I am also looking forward to working with my good friend, Fred Hochberg, who helped to run this Department and now is heading up the Export Bank of the United States. So we have a tremendous panel to discuss this issue with, and a representative from the Department of Commerce. But in conclusion, let me say that, ultimately, this hearing is about exporting. It is about export opportunities for business. It is about export opportunities for Main Street businesses, businesses that with the new technology that we have, this has become a real option. Twenty years ago, it probably wasn't possible. But with new technologies today and the kinds of new opportunities that small businesses can look to, and because of the challenges here at home with their own markets and their own neighborhoods and their own communities, small businesses are looking other places in the world for opportunities. And I think, ladies and gentlemen, if I can say, if we do our jobs the very best we can, it can bring hope and opportunity for the small businesses in our country. I would like to introduce, if the staff will give me the introduction list, we will introduce our first panel of witnesses today. First, Karen Mills, Administrator of the Small Business Administration. Ms. Mills directs an agency of over 2,000 full-time employees, but her network is quite extensive and hopefully she will spend a moment talking about that in her testimony today. She comes fully prepared for this job, tapped by the President to run, I think, one of the most important agencies of the Federal Government right now and we are pleased to have Ms. Mills with us. The Honorable Ron Kirk--he has so many titles, I don't know what to call him, Mayor, Ambassador, and now Trade Representative for the United States of America. He is one of the President's top appointees in this regard and we are very pleased to have you, Ambassador Kirk, with us. Fred Hochberg, as I said, is Chairman and President of the Export-Import Bank of the United States. We are just excited to have him heading up this exciting agency. He has been involved in business, government, and philanthropy for many years and was the former Deputy and Acting Administrator of the SBA. So he and Ms. Mills will have a great deal in common and a lot of ideas to share, having both served in that capacity. And Patty Sefcik is standing in and doing a wonderful job for the Commerce Secretary, who called to say he was sorry he could not be here, that other business kept him away. But as the Acting Deputy Assistant Secretary for Domestic Operations of the United States and Foreign Commercial Service--big title--she is with us today and oversees the Export Assistance Centers operating in 48 different States. So with that, let me turn it over to Ms. Mills. We look forward to your testimony this morning. STATEMENT OF HON. KAREN GORDON MILLS, ADMINISTRATOR, U.S. SMALL BUSINESS ADMINISTRATION Administrator Mills. Thank you very much, Senator Landrieu. I have to say that the people of Louisiana and all of America's small business community are very fortunate to have such a strong advocate as you are in Washington and in the U.S. Senate. I want to thank you also for the past couple days. We have had a chance to see firsthand what is going on in this continued but difficult redevelopment effort here in this region and to visit with small businesses and entrepreneurs, Main Street entrepreneurs in a gas station, one of the first that has come back to a devastated community and has provided some of the linkages to grow that entire revitalization effort. We have seen young, vibrant entrepreneurs. But there is much work still to be done here and we are very happy to work in this community and to be part of that effort. It is also a pleasure to be here with Ambassador Ron Kirk and Chairman Fred Hochberg and Acting Deputy Assistant Secretary Patty Sefcik at the U.S. Department of Commerce and everyone else who has joined us today. Truly, it is going to take all of us working together to keep America competitive, as the title of this hearing suggests. Madam Chair, I am pleased to share the SBA's efforts to help small businesses compete in the global marketplace. The SBA provides access to capital for small businesses on Main Street and to some of the country's high-growth, high- impact small businesses. The SBA has a portfolio of loans and loan guarantees of more than $80 billion. We have 68 district offices, including one here in New Orleans. We have more than 2,000 employees, as well as 1,200 stand-by trained employees who can be deployed to communities affected by disaster. And we also have 18 Senior International Trade and Finance Regional Managers across the country. Our partners are part of our important network and they include over 900 Small Business Development Centers--and we have 11 here in Louisiana--and more than 100 Women's Business Centers--and we have two here in Louisiana, as well. We have 350 chapters of our mentoring group, called SCORE, and they have five chapters here in Louisiana. So all told, as you describe, we have a very broad bone structure throughout the United States which includes about 14,000 affiliated SBA counselors. We know that this is a difficult time for small businesses to gain access to capital, so since the Recovery Act passed, we have redoubled our efforts to put more money into the hands of entrepreneurs and small business owners. We have done a number of things. We have raised the guarantee on our 7(a) loans to 90 percent and we have reduced or eliminated the fees on our flagship 7(a) and 504 loan programs. And as a result, the loan volumes in these programs are up more than 35 percent compared to the weeks before the Recovery Act. In addition, importantly, we have brought nearly 600 banks and credit unions back to the SBA programs, nearly half of whom had not participated since 2007. For Louisiana, this has resulted in $55 million in lending support for nearly 200 small businesses throughout the State, and I want to give you just two quick examples to bring this alive. In West Monroe, Sawyer Industrial Plastics has provided plastic repair parts for the paper industry for 32 years and the owner was shifting his strategy to a new market when his conventional credit was canceled. So he was able to get an SBA loan of $700,000, which was a lifeline, and the fee savings from the Recovery Act allowed him to add an employee to help with the new products. The second example is just north of here, in Mandeville, Woolf-Harris Plumbing bought a new building, but they were left short of cash, and even though the demand for their products and services was high, with the increased guarantee from the SBA, a local bank was able to extend $250,000 for working capital through a 7(a) loan. Nationwide, about 20 percent of these loans have gone to minority-owned businesses, 19 percent have gone to women-owned businesses, and in fact, the SBA is three to five times more likely to make loans to women- and minority-owned businesses than conventional lenders. In addition, just two weeks ago, we added another tool to the toolbox, a brand new program called America's Recovery Capital, or ARC loans. These loans are providing the relief that many viable but struggling small businesses need. ARC loans are 100 percent guaranteed by the SBA. They are for up to $35,000, over six months, interest-free to borrowers, and they have no repayment for 12 months after the final dispersal. The Recovery Act also provides billions of dollars in contracting opportunities. We are responsible at the SBA for making sure that small businesses have the opportunity to deliver at least 23 percent of Federal contracting. We see this as a win-win situation. Small businesses benefit by getting increased volume and sales, and the Federal agencies and the taxpayers benefit because they are working with the most innovative companies, often with a direct line to the CEO. All of these efforts of the Recovery Act are aimed at building a stronger foundation for small businesses to grow and to explore areas like the one we are here to talk about today, international trade. Overall, small businesses accounted for more than $500 billion last year in export sales, or nearly 30 percent, while it is still difficult for many small businesses to know exactly what steps to take to reach potential export markets. In fiscal year 2008, the SBA facilitated more than 3,300 loans for exporters, and in the Louisiana and Texas region, we were able to provide training and counseling to more than 300 lenders and more than 600 small business owners. We have international trade loans, which I will describe in a moment, but the Recovery Act has allowed us to raise the guarantees on those loans, as well, across all our programs and to waive the up- front fees for borrowers on loan terms of greater than 12 months. Some examples of our program: We have the Export Working Capital Program, and that loan is coordinated through our SBA staff that work in collaboration with the Department of Commerce at 18 U.S. Export Assistance Centers around the country, and we have a growing number of preferred lenders to whom we delegate the authority to process these loans directly to our loan processing center in Sacramento. These loans are important because small businesses often need an initial line of credit for suppliers, inventory, or production of export goods, especially when the first big order from abroad comes in. The SBA provides nearly $1.7 million for these loans and we can also co-guarantee with the Export-Import Bank on loans of up to $2 million. Another key program is the Export Express loan, which can be up to $250,000 and can usually be approved within one or two days by an SBA Express lender. These loans can be used to enable a small business company to prepare for exporting. For example, it can help with the translation of a business website or marketing material and it can also help them participate in trade missions. So far for this fiscal year, the SBA has guaranteed 598 loans to exporters and we are working tirelessly to continue our outreach and advocacy for small business exports, both here in Louisiana and throughout the nation. As part of that, I am actually pleased to say that we are in the process of hiring our newest Senior International Trade and Finance Manager, who will be permanently assigned to the U.S. Export Assistance Center here in New Orleans. With all these efforts, I am pleased to be working with Ambassador Kirk, Chairman Hochberg, Secretary Locke, Acting Deputy Assistant Secretary Sefcik, and our other agencies who are represented by the Trade Promotion Coordinating Committee. This is important because we do have a group and we do work very hard together to make sure that the Federal Government's programs are coordinated and accessible to small businesses and other exporters. Through our collaborations, we can ensure that small business will build a stronger foundation of American competitiveness while creating well-paying jobs in the 21st century. Thank you. [The prepared statement of Administrator Mills follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you, Administrator Mills. You can illuminate one of my questions, which was when is that representative going to be appointed, so I am glad to know that the time is just right around the corner. Mr. Kirk. STATEMENT OF HON. RONALD KIRK, AMBASSADOR, UNITED STATES TRADE REPRESENTATIVE Ambassador Kirk. Well, I would like to join the Administrator, first of all, in, Madam Chairman, thanking you for your wonderful, tenacious advocacy on behalf of small business, but also, being a neighbor in Texas, there is a wonderful kinship between Texas and Louisiana, and even though I am sitting here as a U.S. Trade Representative, I am also a distinguished graduate of the University of Texas and was going to serve as President-Elect of the Texas Exes, but I will happily say ``Go Tigers'' today. [Laughter.] Chair Landrieu. Thank you. Ambassador Kirk. Not that happily. [Laughter.] Chair Landrieu. Begrudgingly. Ambassador Kirk. It was a great series. Chair Landrieu. It was a great game. Ambassador Kirk. But thank you so much for your advocacy on behalf of small businesses and for the region. I may be able to abbreviate my presentation. You jokingly referred to my number of titles as Mayor, Secretary and Ambassador, and I think I would have to refer to you as Senator and Chairwoman and perhaps Ambassador Pro Bono. You did a fairly great job of explaining the importance of small businesses to the growth of trade and exporters, and in fact, there are almost 230,000, 240,000 small businesses that are involved in export and they do represent 90 percent of our exports. My experience as mayor tells me that is a great growth opportunity for our country. As we were talking over lunch, all of us throw these statistics out so casually and easily about small business being the background, particularly of our towns and our cities and our urban areas. But as your pie chart shows, there is an extraordinary opportunity for growth. If we can invest in those small businesses and take them from having 70 employees to 140, or take them from 25 to 50 and duplicate that not only up and down the Gulf Coast and the Mississippi River that feeds your important port, but all around the country, I think we can readily calculate and easily calculate the value that would be to America and our economic recovery. So I am pleased to work with you in this endeavor and to work with our colleagues here, as well. So in that vein, I want you to know it is important. I know that you and Senator Snowe, in particular, have strongly advocated for the creation of an Assistant USTR for Small Business, but I want you to know the importance it is to us. We are the smallest of the agencies within the Executive Office of the President, with only 227 employees, and so we would welcome all of the assistance that we can get. But I am also sobered by the reality that one person doing that job may not be as effective as making sure that we have maintained a focus on small business throughout our agency. And I want you to know it is one of our highest priorities. Small business cuts across all of the work within the United States Trade Representative, so even though there may not be one person dedicated, it comes up in everything we do-- in the negotiation of our trade agreements, in our enforcement, in our intellectual property rights work, and it is important enough that I have already had and invited to our office Commerce Secretary Locke to strengthen the ties that we have with Commerce through the office represented by Ms. Sefcik and others. SBA Administrator Mills came over last week and brought her team, because I want to make sure that we are doing everything humanly possible to take the burden off that small business person to have to weave their way through those 19 Federal agencies and that we can work collaboratively perhaps and be a single point of entry to make sure that we work with small businesses to help them understand the critical role that they can play in exporting. You talked about the importance of the port here to New Orleans and Louisiana. We know that more than 2,300 Louisiana businesses exported goods, according to the most recent data that we had, with small businesses accounting for more than a third of your State's total exports. And work at the Port of New Orleans here, as you mentioned, supports over 160,000 high- quality jobs, and we have the data now that we know that the jobs that are related to exporting and trade tend to pay anywhere from 15 to 20 percent higher than other jobs in our economy. So small businesses that are involved in exporting can be a great way to help rebuild the Gulf Coast, but also sustain those families, as well. And when we improve business access to new markets overseas, which is one of our top priorities, we are helping to grow good jobs here at home in America. You mentioned Mr. Cole, and we were pleased to be able to help join in congratulating him as your Louisiana Small Business Exporter of the Year. I also had the great joy in joining with Administrator Mills at the State Department last month in which we highlighted and feted those small businesses across the country that have been successful in exporting. And we want to continue to work with you and the Administrator to make sure that we are opening new markets, but doing so in a way that we meet those challenges that you referenced in dealing with non-tariff barriers, customs, regulations, and others that for large businesses are an annoyance, but for small business can in many cases be an absolute bar to them going forward. We want to work with you to make sure that we are addressing those. So we are asking ourselves the question at USTR every day: How can we make sure that our small businesses not only are aware of the opportunities within the world of trade and exporting, that they have access to the information to get involved, and what can we do to make sure that we assist. Let me tell you a little bit about what we have done. Since 2002, exports by small and medium-sized businesses have nearly doubled--that is the good news--from $160 billion to $311 billion in 2007. But again, that pie chart is so illustrative. I think it shows the explosive potential for growth that we have by investing more in our small businesses. One example of ways that we do that, we can create market access for businesses, America's small businesses and manufacturers and farmers and ranchers by two ways. Principally in the past, we did it by negotiating new free trade agreements, such as the agreement with Mexico and Canada, NAFTA and CAFTA. But the reality is, as those free trade agreements have matured over the years, we are more likely to create market access by doing what I think you asked us to do, is to deal with some of these non-trade barriers in the way other countries unfairly enforce their rules. We had one very high-profile success I am proud of. I have been in office less than 90 days now. Within six weeks, we had settled a 20-year-old dispute with the European Union over access of American beef products to the European Union. It may not seem like a big deal, but the fact that we got that resolved in six weeks, opened that market up to where it now will have thousands of tons more American beef exported within the European Union, well, to me, that doesn't mean anything unless I think about those farmers and ranchers and the suppliers and all of those individuals you were talking to us over lunch that literally flow into this corridor, from Texas and Arkansas and Iowa and the Midwest down the Mississippi River. In many cases, the poultry, the beef is shipped right out of your port here. So by dealing with these barriers to market access now, we are creating opportunities for families, ranchers, manufacturers, many of whom are small family-owned businesses today, which translates into increased jobs and better paying jobs. So we are making market access for small businesses one of our highest priorities, and we have heard you. In all of our negotiations, we are actively addressing issues as customs facilitation, non-tariff barriers to trade, and intellectual property rights, as well. I also would like to draw your attention to the fact we just launched a new website. It is ustr.gov. Like you, I have a couple of brilliant teammates, daughters, who upon my announcement by the President as his nominee to be U.S. Trade Representative, on the same day that he announced Karen Mills, my daughters went on our website immediately and my smart-aleck 20-year-old, who is at Columbia, came in and she said, ``Dad, this website is so 1987.'' [Laughter.] It took somebody else to bring it to my attention that we might not have even had the web in 1987, but we have made it. One of the priorities of President Obama is to increase information through the Internet. It is much more interactive. We are hoping that small businesses can go there, learn about our office. We have links to the FBA, the Export-Import Bank, and others. So I would hope that any of the businesses that hear or see this, if they want to learn more, would come to us at ustr.gov. Additionally, we are also expanding the access and inclusion of small business on a number of our advisory trade committees which are so important to our work. And so we have recommended small business owners for every one of our trade committees, from labor and the environment as well as the President's Advisory Committee on Trade Policy. I look forward to working with you and Senator Snowe and others--obviously, that is a Congressional prerogative-- if you choose to create a new Ambassador for Small Business, but I want to give you the assurance that small business is at the core and at the heart of our work at USTR and we look forward to working with you. [The prepared statement of Ambassador Kirk follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you so much, Ambassador Kirk. I truly appreciate that, and thank you for referencing my interest in creating a position. We look forward to continuing to work with you to see how that might move forward. The Honorable Fred Hochberg. STATEMENT OF HON. FRED HOCHBERG, CHAIRMAN AND PRESIDENT, EXPORT-IMPORT BANK OF THE UNITED STATES Mr. Hochberg. Thank you. Thank you, Chairwoman Landrieu. I have a longer statement which I would like to be entered into the record. Chair Landrieu. Without objection. Mr. Hochberg. I am pleased to appear before you today to discuss Export-Import Bank's efforts to create and sustain job growth in the U.S. small business sector. As you well know from your role as Chairwoman, small businesses drive innovation and technological advancement, and their success, as I saw in my own family business and at the SBA, is critical to our economic growth. I also appreciate the opportunity to come back down here to New Orleans. I enjoyed working with you at the SBA. We did a conference when I was at the new school about cities and recovery and I was happy at that time we actually set up a scholarship fund for citizens of Louisiana to study urban policy in New York, and that program is still continuing. Chair Landrieu. Thank you, Fred. We appreciate that. Mr. Hochberg. President Obama placed me at Ex-Im because of my personal history with and commitment to small businesses. I understand firsthand the challenges that these owners face, having worked in my family's business for 20 years, and President Obama's support of Ex-Im's small businesses and exporters is vital to the solution of our current economic challenge. I also know Administrator Mills understands these issues facing small business exporters and I look forward to working more closely with her. As the Ambassador mentioned, I met Ron Kirk when he was Mayor, so in one of his other titles, and I am also happy that Patty Sefcik is also here from Commerce. The business outlook today is daunting. We are in the midst of an economic crisis in credit, lack of liquidity, and depressed consumer confidence. Ex-Im is stepping up to help sustain and create U.S. small business jobs. It is our mandate. It is what we do. Through Ex-Im's insurance, working capital, loans, and guarantee programs, we have supported over $50 million worth of Louisiana small business exports in 2008. Madam Chair, let me give you an example from right here in New Orleans. Reliable Industries provides mining equipment to countries such as Canada, Guyana, and Zambia. Since 2002, Ex-Im has provided Reliable Industries an export credit insurance policy which allows such international sales to go forward. I actually met Mike Rongey, who is the President of Reliable Industries, this morning, and I believe he is in the audience with us today, along with his bankers, Bill Richard and Bill Cummins of Chase, that helps provide some of that credit. Reliable Industries, with 35 employees, exemplifies Ex-Im's mandate, to create and sustain jobs in the United States by helping to finance exports of U.S. goods and services that the private sector is unable to otherwise finance. And in fact, Mike just dropped me a note just this past week. We helped him secure a half-million-dollar order to Latin America and, in fact, the goods are about to ship out of Houston in the next week, in fact. So far this year, Ex-Im has authorized over $2.5 billion for the support of small business exporters, up more than $1 billion compared to the same period a year ago. Let me just take a moment to review two programs most important to our small business customers. First, we provide insurance to U.S. exporters to insure their foreign receivables. This reduces the risk of non-payment and drives more U.S. sales abroad. Additionally, we have worked to find more ways to reduce the cost to small businesses. For example, in October of 2008, we reduced our premiums only to our small business customers by 15 percent. Second, our working capital guarantee program is often used by small business exporters. With this product, we guarantee 90 percent of a commercial bank loan for a U.S. exporter to fund the purchase of both equipment and raw materials to fulfill an export contract. At a time when commercial banks are stepping back, Ex-Im is stepping up to meet this need. In an effort to better serve small businesses, Ex-Im works with SBA to provide one-stop shopping. In April 2004, way before Administrator Mills and myself, the SBA launched a co- guarantee program. This initiative allows Ex-Im to supplement SBA's guarantee to help small business exporters obtain larger loans than SBA could support on their own. Under this initiative, since 2004, we have supported 46 loan guarantees, resulting in just under $350 million in exports. I do believe that we can and should do better and I look forward to working with Administrator Mills to accomplish this. Our regional directors partner with other agencies, such as the Department of Commerce Export Assistance Centers, to harness all Federal, State, and local resources to encourage export activity. And in fact, just yesterday, I met with Commerce Secretary Locke and I look forward to expanding our cooperation with him in the Commerce Department in pushing U.S. exports. Furthermore, in picking up what Ambassador Kirk mentioned, we have Ex-Im Online that provides an automated transaction processing system to reduce paperwork and allow our customers to track applications in real time. And this morning, I met Carlos Hidalgo, who I know that you know, who is here today from tech sales from Italy and he complimented and said the best thing I could have heard about this online program. In closing, let me just give you one more example of Louisiana's small business receiving Ex-Im support. The company is Living Quarters Technology in Baton Rouge. It has the largest fleet of affordable living quarters for the oil and gas industry in the Gulf of Mexico. Living Quarters Technology employs 45 people right here in the State. An Ex-Im insurance policy, coupled with a working capital guarantee, allowed them to compete and win a $5.5 million contract with the Mexican oil company Pemex, and we were part of that bid package. These companies remind me of my own start, and at present I have a mission at Ex-Im to see more of these small business successes. I look forward to any guidance from you, Madam Chairwoman, and your Senate colleagues to enable more U.S. small business exporters to capture overseas sales. I would be happy to answer any questions. [The prepared statement of Mr. Hochberg follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you very, very much. And let me just ask--I will do this in my questions, but when you said you combined the program and your guarantee was able to increase, do you know what it was able to increase to, the amount when you combined your programs? You could check. Administrator Mills. The total would be $2 million. Chair Landrieu. Two million, okay. Thank you. Patty. STATEMENT OF PATRICIA SEFCIK, ACTING DEPUTY ASSISTANT SECRETARY, DOMESTIC OPERATIONS OF THE U.S. AND FOREIGN COMMERCIAL SERVICE, INTERNATIONAL TRADE ADMINISTRATION, U.S. DEPARTMENT OF COMMERCE Ms. Sefcik. Thank you. Senator, thank you for the opportunity to speak here today about the role of export promotion and our efforts to strengthen and support America's economy. It is truly a pleasure to be here and I am quite honored to be part of this distinguished panel. Let me assure you that Secretary Locke recognizes the important role small businesses will play in pulling America out of this economic crisis. The Secretary recognizes that it is important to streamline government bureaucracy and bring solutions and services directly to businesses to help create and sustain family wage jobs. My testimony today will provide you with some insight on how the Department of Commerce has and will continue to implement programs that promote small business exports. The International Trade Administration helps American firms and workers navigate the often complicated waters of foreign trade. Within this unit, the U.S. and Foreign Commercial Service operates a global network of trade promotion professionals and 109 U.S. Export Assistance Centers and at U.S. embassies and consulates in 77 countries. Commercial Service staff provides U.S. companies with numerous services, ranging from export counseling and market research to identifying foreign international buyers and providing advocacy support. Overall, the Federal Government's trade promotion efforts are led by the Trade Promotion Coordinating Committee, or the TPCC. The TPCC is headed by the Secretary of Commerce and its members comprise 20 Federal Government agencies, including the agencies here today on the panel. This committee develops priorities on trade promotion and finance programs which are designed to assist small businesses sell their goods and services overseas. As part of this effort, the TPCC sponsors interagency training to promote a better understanding of these programs, and to date, over 700 participants from 12 agencies and seven States have completed this training. SBA and Ex-Im Bank representatives are co-located in some of our domestic locations with the Commercial Service, and together their efforts have resulted in an impressive list of export successes. For example, in Louisiana, the Dredging Supply Company located in Reserve, Louisiana, is a family-operated manufacturer of customized dredging equipment, which is used all over the world. One recent sale included a $3.5 million dredge financed by a loan backed by Ex-Im Bank. Among other things, the company attributes this success to the assistance that they received from the local Federal colleagues. Companies, especially small businesses, also use our Trade Information Center, called the TIC. This call center serves as a single point of contact for the TPCC's export assistance programs, and last year, the TIC gave personal assistance to more than 36,000 inquiries, with 73 percent of them coming from small businesses. In addition, we also have a TPCC website, which is export.gov, that acts as a portal for the Federal Government trade promotion resources. Other services used by small businesses include international buyer shows, trade fairs, and trade missions which assist U.S. companies in developing their business relationships with customers overseas. In 2008, we supported trade missions to 27 overseas markets with a total of 420 U.S. companies participating. This resulted in nearly $350 million in sales to date. Several Louisiana companies are currently bidding on major projects as a result of the March 2009 trade mission to Columbia. Strategic partnerships are key in reaching out to small businesses, and so, for example, the Louisiana Economic Development Office and the Louisiana District Export Council played a very strong and active role in sponsoring activities in conjunction with that trade mission. We work very closely with State and local partners throughout the United States to educate small businesses on the benefits of exporting, and another key partner for the Commercial Service is the network of our 60 District Export Councils, who work with us to increase exports through joint outreach and education events. So in closing, the downturn in the world economy has adversely affected all of our industry sectors and exports. Many of our major trading partners are experiencing it even more, resulting in recent declines in foreign demand for our goods. So in these troubled times, the Department of Commerce and the TPCC agency's export promotion work is more important than ever for small businesses. I remain committed to promoting small exports. [The prepared statement of Ms. Sefcik follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you very much. I appreciate all of your testimony, and let me, if you don't mind, Deputy, start with you, because this is one of the most important issues before our panel today, which is the Trade Promotion Coordinating Committee, which you referred to in your testimony. In 1992, Congress established this committee to provide a framework to coordinate U.S. export promotion activities across 19 different Federal agencies. As you know, it is chaired by the Secretary of Commerce. Congress requires this organization to produce an annual National Export Strategy document, which provides an overview of export promotion activities by these agencies. The GAO, however, has recently reported that although we have made steady progress since 1993, we have not made as much progress, including the tracking of small business participation across agency promotion efforts. Can you briefly outline the roles, each of you, that your agency is working with the agency next to you, so starting with Commerce and then to Fred and over, how you all are working in this particular framework? The Senate has confirmed now the main core. All of you have been confirmed recently by the Senate, so you are now in place. Has the National Export Strategy been submitted to Congress yet, and if not, why not? So, Patty, why don't we start with you, and then if each of you could just comment on this particular Congressional program that was established now 17 years ago. Ms. Sefcik. Thank you. It is a very good question. The Secretariat for the TPCC obviously does reside in the Department of Commerce and we have been working collaboratively with all the agencies. Obviously, within the TPCC, there will be some core agencies that come up to the forefront, including the agencies that are here at the table today. The National Export Strategy is a way every year to measure our successes with the division of where we wanted to move forward. In a transitional year, such as now, the National Export Strategy over time historically is never printed out in a transition period. But having said that, we know that Secretary Locke has reached out to a lot of his colleagues within the TPCC and we are looking forward to having its first meeting this fall. For that meeting, the goal would be to have that visionary strategic plan of where the administration wants to go with the promotion of the Federal Government resources to collect--to come together, because what we find out through our collaboration, a lot of the staff that are located around the United States where we co-share, we come to a point where we want to show the successes in a visionary type of way so we can keep building on one another's expertise. It is that added value versus we can do it alone. So we are hoping that we have the TPCC under the administration, that will show the vision, and once that vision, what the priorities are established, each year then thereafter, the National Export Strategy would be printed out almost like a way of the accomplishments of an annual report. So that is why it is not going to be published this year, due to the transition. Chair Landrieu. That is very important, because, of course, you know, without a vision, people perish. But without a vision, you can't really move forward in a coordinated way because there are so many different pieces. People aren't really clear what the goal is. So if we can at least update, you know, refresh and update that strategy, particularly with some of the new leadership that is on board, and it is nice to get that on the record that you will all be meeting in the fall, and then potentially do you know--do you have a time frame of when the report will be ready for Congress? Ms. Sefcik. I don't have that information with me right now, but I could definitely send you a written response to that question. Chair Landrieu. Okay. Ms. Sefcik. But I would like to say here again, at the working level, all of the staff, all of these agencies here continue to collaborate with all the joint training, the joint conferences, the joint events. The trade missions have been hugely successful. So we are continuing efforts, and as our leadership comes together, the vision will be set. Chair Landrieu. Okay, and Chairman Hochberg. Mr. Hochberg. Secretary Locke and I actually just talked about this yesterday when we had lunch and we are looking at some joint programs we could do around the country to sort of do some regional export forums and roundtables, similar to what we are doing today, and bringing more folks to understand best practices and examples and some of the products offered. That is at all of our regional offices. We have five regional offices and two satellites. All reside in Commerce Department offices, in their Export Assistance Centers. So they anchor our work there, and many of the leads we get come right from the Commerce Department. So we really work very closely with them for those exports that need financial assistance to get done. Many exports don't need our assistance, and those that do, Commerce provides them those needs. Chair Landrieu. Thank you. Ambassador. Ambassador Kirk. Yes, Madam Chair. I would add, I think I referenced it in my remarks, my prepared remarks, the work and the outreach we have done both with Secretary Locke and Administrator Mills. I would just underscore, too, even while we are waiting on the formal convening of the Policy Coordinating Group, to echo what Patty and Fred have said, that the working groups continue. We have been particularly aggressive in reaching out with Administrator Mills and getting our teams together to help them understand the imperative for moving quickly, just to make sure that--my experience as Mayor suggests just remove as much of the burden from that small business figuring out. I tried to have a very retail approach to being Mayor, and we all know the bad experience of going to a grocery store and then saying, ``It is over there,'' as opposed to somebody saying, ``Let me take you and get it for you.'' And so what we are doing is just trying to make sure every day and everywhere, everything we communicate when we interface with small businesses, that we work to get to the right people at the right place. And again, even on our website, I have done something that was scoffed at when I was Mayor, but I have invited businesses to tell us what we are doing that drives you nuts and then challenge our agency to explain why we have to do this, or if we can't come up with a good reason, then we need to stop it and look at changing the rules. So we are reviewing that process. We are asking small businesses to contact us to tell us what we can do to help them more effectively, particularly in our negotiations to help remove barriers, and then working with all the agencies. Chair Landrieu. Ms. Mills. Administrator Mills. Well, Madam Chair, thank you for bringing up this point, because the Trade Promotion Coordinating Committee is very, very important to our efforts and the SBA is very pleased and excited that Commerce's leadership is going to bring this group together in a vital way. This is important for us to be able to do our work. Our current organization is housed, co-located with Commerce for all of our trade activities, and as you know, we do co- guarantee already with Ex-Im Bank. But I think even more interesting is the strategy that Ambassador Kirk and I have begun to discuss, really from the first meeting that we have had, and now we have got our teams together, which is how is it that we are going to deliver the small business aspect of this coordinated strategy. So that will be ongoing and will be finally brought to you by the reports and the activities of this Coordinating Committee. So thank you for the pushing. Chair Landrieu. Thank you, and I will only add--I have a few more questions and then we are going to move to our second panel, but I would only add, and I am not the expert on the Internet, but I am really enthralled with what I am able to do myself, which is very empowering. But when I watch what my staff is able to do in terms of finding information, accessing, it truly is quite remarkable. And as a government official for many years, it occurs to me that some of our stovepipes, not only do we need to collaborate more with each other, but we have got to be on the cutting edge of this communication so that when a small business is sitting out there somewhere in America and they are thinking, I want to export, they have some idea of what part of the world they want to export to, they should hit a button, and let us say Colombia or Central America, South America should come up, and there should be information very valuable from each of you and all of the different entities so that it starts framing a clearer picture of the opportunities in that country. And that is the way the new generation uses the Internet. You know, you want to go on vacation. You sit there and you look at all these sites and you think, where do I want to go in the world? You hit a button and you have got lots of options. I see these heads shaking, so I know I am hitting some nerve here. But I don't think that government actually, although the President himself has done quite a remarkable job with his own communications, I think that the government entities--and I am going to make sure at least the ones that I have some responsibility for push this issue out, because it is just the way this generation operates. They don't go to conferences. They go to their living room, hit the ``click'' button, and they take themselves all over the world, and we have got to respond to that. So my point would be, have the meeting, get the plan, but let us get the plan on the Internet in a way that people can facilitate it and use it, because really, truly, it is a great market out there, and as you see, we have a great many businesses that are searching for markets. They are looking for them in their area where they live, but they are also looking at markets around the world to grow their businesses and I think we can be helpful. Let me just ask a few more questions, if I could. Ms. Mills, you know that last year, the SBA made 3,300 loans to exporters. We approached the end of the third quarter of 2009. Our records show that only 598 loans have been made to exporters. Now, we know there is an economic downturn not only here at home, but markets abroad have been shrinking. Do you agree that these are the figures? If not, could you clarify what you think they are, and what are some of the strategies that you might employ now as the new leader of this agency to see what we could do, if you could list maybe one or two specific things to try to move these loan amounts or numbers up. Administrator Mills. Thank you, Madam Chair. These are the same figures, I believe, that we have, and as you know, lending in the fall of this year really just ground to a halt overall. Our overall lending is down 50 percent. And with the Recovery Act, we have been able to push that back up by 35-plus percent, but it is not even yet close to 2008, 2007 levels. So we have more work to do, both to get banks back in the program and to get companies ready to be able to borrow. That applies, as well, to our exporting communities, plus I think what you heard here is that we have the opportunity now to increase our collaboration with the others at this table and explore ways that export markets might provide the revitalization that some of these companies need. So a company that before was doing just fine domestically and now finds those markets are not coming back could very well be turning to export as a more primary option. So I think the things that you have heard today, developing this collaborative small business strategy, continuing our outreach, both through the Recovery Act programs, we have revitalized our district offices, we are adding to our export representatives that are co-located with Commerce, and even more importantly, Secretary Locke and I have talked about this enormous network that Commerce has domestically and in other countries and using that network. We have also talked to the Department of State. They have economic representatives. And so we are looking at using those and connecting those, who mostly have been dealing with large businesses, connecting those more strongly to small businesses. So I think that could be very powerful. Chair Landrieu. Thank you very much. Chairman Hochberg, let me ask you, 22 percent of the Export-Import Bank's financing directly supported small business. As you know, there is a legally required threshold of 20 percent, so last year the Bank met its goal. What are your plans, though, as the new Chair to perhaps even expand on this threshold, and what potentially do you have in mind to see if we can not only meet, but potentially even exceed this goal of 20 percent next year? Mr. Hochberg. Thank you for the question, and more importantly, thank you for your interest. Actually, in the two prior years, we were actually as high as 26.7 percent, though those percentages are very--they are difficult to manage, and I will give you an example. This year, small business lending is up 83 percent, but large aircraft, such as Boeing, is up 100 percent, so although we are making great strides and actually have an increase in loans to small business exporters this year, some other transactions have grown even more quickly. So although we have a goal of 20 percent, I would not say that we are going to meet that every year. Some years we will go above it. Some we may be a little lower because we want to take in every piece of business we get in the door and not turn someone down just to meet our numbers. But that said, I mentioned in my written testimony, I was out in Pittsburgh last week. I met with all of our regional directors, looking at a number of the programs that we have, seeing what some of the impediments are to making those programs more effective so that we can help more small business owners in their export efforts. We have a program, just to explain, we have a program for insurance, where if you are an exporter selling overseas, we will ensure that you will get the receivable. And once the company has that insurance that they are going to get paid, we are actually going to help them go to a bank and get more loans for working capital and other types of--to help the rest of their business. That may in some way pick up some of the slack that some of the small business lenders are having, because once a company knows they are guaranteed to get paid, a bank is more likely to lend to them. So we are trying to couple a number of those programs together in a way that we really haven't before. Chair Landrieu. And can I ask you to follow up? What strategies are you employing to coordinate some of this with the community banks in the country, not necessarily the large national banks, but do you have any special relations with the community banks which are regulated at the State level and for the most part managed through this downturn pretty well? Mr. Hochberg. You know, I had great experience with the community banks when I was at the SBA. We had a program called Community Express, where we actually delegated specific authority to community and small banks. There has been so much turmoil in the banking industry, and in fact, just this past week, we have been discussing how we manage our banking relationships better because they are frequently product line by product line and we are not very often looking at how we are managing an entire book of business with an entity. I think community banks are very important and probably even a bit under--not gotten the full attention they should have gotten. Chair Landrieu. Well, I share that, because in my experience in the last couple of months dealing with this financial crisis that the members of Congress have had to deal with literally every day, it occurs to me that there is an extraordinary network of community banks as well as credit unions out there who are in these communities, located on all these Main Streets, who know all these businesses who are trying to reorganize and shuffle through the challenges before them. And I know that the Administrator and I have spoken about this and I would like her to comment in a minute about what the SBA's vision is to build a stronger partnership with the community banks that are located in every town, large and small, from Dallas to Tallulah to Jackson, Mississippi, to Portland, Maine, and in between. So I don't know, Administrator Mills, if you want to just respond for the record of some of the things you are thinking about with reaching out to community banks and getting them more involved with the core SBA lending programs, but also perhaps just as better all- around partners to what we are trying to do at the Federal level. Administrator Mills. Thank you, Senator. Actually, you brought this up in my confirmation hearing and we actually took it to heart and have been working on it as a priority ever since, and that is how do we add banks, particularly community banks, to the SBA network? We had been losing banks up until this point. We have about 50 percent penetration in the Federally chartered banks, but very low penetration in State chartered banks, which are mostly these community banks, and also with credit unions, which are another priority. So we have done a number of things to reach out to community banks, including conversations with the heads of the community organizations, understanding how they use SBA products, what we can do to bring more into the fold. And in fact, we have had a reasonable amount of success, because as I said, 600 banks have come back to the SBA and made a loan since the Recovery Act was announced in February. So that is 600 banks who had not made a loan since October. Half of them actually had not made a loan since 2007. And so the majority of these are the kinds of banks we are talking about, and it is because we were able to reduce our fees, increase our guarantees, and reach out to them-- they had the capital but they couldn't lend because they didn't have a secondary market for their goods and they didn't have the liquidity. So we have now begun and we will get more with the ARC loans, new lenders, and we are making this one of our objectives. As you know, I have a dashboard with certain metrics on it. This is one of the top metrics we follow. Chair Landrieu. Thank you. We are going to move to our second panel, but is there anything that you all did not get to say that you would like to add before this testimony is closed? Of course, the record will stay open for the panel for two weeks. But anything that you want to add, Madam Deputy? Mr. Chairman? Ambassador Kirk. Thank you for your leadership. Administrator Mills. And also, thank you and to this region for the hospitality. Chair Landrieu. Thank you. Well, you are welcome and we hope that you will come back often. Many of our restaurants have opened and reopened. We don't have 100 percent of them open, but I guarantee you can get a good meal if you come, so thank you very much. We will take a five-minute break and bring our next panel up. [Recess.] Chair Landrieu. We have with us Mr. Eugene Schreiber. Gene Schreiber, Managing Director of the World Trade Center of New Orleans is our first witness. He is here on behalf of 1,600 corporations and individual World Trade Center members. Many of us know Mr. Schreiber and we thank you very much for your leadership. Ms. Diana Simek is our second witness, representing Shreveport and Northwest Louisiana. Ms. Simek is Vice President of Ark-La-Tex Regional Export and Technology Center and Manager of the Metro/Regional Business Incubator. Both organizations are subsidiaries of the Coordinating and Development Corporation, CDC. Prior to her current position, she owned a public relations firm and has a great deal of experience in this area. Thirdly, Ms. Wilma Castro, owner and Director of International Export Sales, which is a Louisiana company classified as an export trading company based in St. Rose, Louisiana. Her company specializes in the purchase of resale of U.S.-manufactured supermarket equipment, commercial refrigeration, and light industrial refrigeration to Latin America and the Caribbean. Mr. Jerry Hingle is our fourth witness. He is Executive Director of Southern United States Trade Association, an export trade development association made up of the Departments of Agriculture of 15 Southern U.S. States and Puerto Rico. It is headquartered here in New Orleans. It operates in over 30 countries worldwide. We are scheduled to end at three o'clock, so I am going to ask each of you if you could limit your opening remarks to three to four minutes and that will give us some time for questions and comments. Mr. Schreiber. STATEMENT OF EUGENE J. SCHREIBER, MANAGING DIRECTOR, WORLD TRADE CENTER OF NEW ORLEANS Mr. Schreiber. Thank you, Senator Landrieu. A lot of exciting developments for the future are taking place in Louisiana on international trade despite the current worldwide slowdown. My written testimony addresses a number of subjects that time will not permit me to cover now. They include Louisiana's role in the global economy, recent export results and trade-related recovery efforts, the State's deepwater port system, and new tax credit legislation regarding the ports, the new non-stop Aeromexico flight from New Orleans to Mexico City, and the possibility of future U.S.-Dominican Republic CAFTA meetings to be held in New Orleans, all of which significantly affect small business. I will focus my remarks now on Federal Government export programs to assist small businesses. We all know that engaging in international trade is a continuous challenge for a host of reasons--payment problems, shipping delays, cultural differences, and numerous changing procedures and documentation requirements to contend with in every country, including our own. All of this can be very confusing and daunting to the newcomer, to say the least. While there is a favorable trend towards harmonization, we are not there yet. Middle-market exporters of manufactured products and services need comprehensive training in the export process in three ways. First, basic training in exporting procedures and documentation. Second, learning about trade finance programs available from the SBA, Ex-Im Bank, and other financial institutions. And third, export promotion programs offered by the Commerce Department and other agencies to Export Assistance Centers located throughout this country, including New Orleans, and at U.S. embassies and consulates abroad in the larger countries. But it is this first category of training that I wish to discuss now. Trade finance, working capital loans, gold key services, and other government programs are of course extremely valuable at a certain point, but I believe the starting point for a would-be exporter is to fully understand the export process, the steps of going to it, the procedures, trade terminology, regulation, and documentation. This includes learning how to prepare an export business plan, understanding the role of freight forwarder, the difference between FOB and CIF, preparing a pro forma invoice, packing lists, the shipper's export declaration, and other documents and details involved in exporting, where even small errors can be potentially very costly. All this takes time and effort by small business to learn, and despite the available technology, it can't be Googled or absorbed at a breakfast or half-day workshop. To meet this need, the Greater New Orleans Small Business Development Center, under the SBA, offers a 17-hour export-import seminar that is divided into four afternoon sessions of four-and-a-half hours each. Admittedly, that may seem like a lot of time for a small business person to devote to learning the basic export and import process, but it is necessary, although the export and import sections could be divided into two separate courses. But the real problem is that for budgetary reasons, the course is offered mainly in the New Orleans area at this time, whereas most of the individuals and companies that require this intensive training are located in other parts of the State. One solution would, of course, be to dedicate additional human resources, if they are available, to conducting the training in more locations to reach more companies. But a better remedy would be to develop training videos or webinars that can be widely publicized throughout the State. The SBA and Commerce Department may want to jointly evaluate this possibility if they haven't already done so. With regard to several recommendations that have been made by your committee, we applaud your initiative to heighten attention on exporting by small companies. Specifically, the recommendation to create an Assistant U.S. Trade Representative position for small business issues and the recommendation to appoint an Associate Administrator in the SBA to be in charge of overseeing all trade policy and programs and to coordinate efforts with other agencies would certainly appear to help accomplish those objectives. Regarding trade-related positions in Louisiana, it is our understanding--in fact, it was confirmed by the Administrator a few minutes ago--that SBA may assign a financial trade specialist to work out of the Export Assistance Center where, in fact, there previously was such a staff person some years ago. So this is most welcome. We would also suggest, and I think this is very important, that the individual assigned to that position by the SBA be equally knowledgeable about the basic export processes described earlier in order to assist in overall export training and not be strictly limited to working on SBA export loans. We also are aware that the Export Assistance Center in New Orleans is short at least one trade specialist at this time, and filling that position, which has not been discussed up until now today, also would be important in terms of further assisting exporters, and particularly new-to-market small companies that have a good export potential. We would make the same recommendation as above insofar as that staff person have a good grounding in the details of the export process, including documentation and procedures. With regard to Federal Government export finance programs for small businesses, in a nutshell, most of our World Trade Center members we talk with believe that Ex-Im Bank's 50 percent U.S. content for its short-term and credit insurance programs is too high and that the SBA's ceilings on their two relevant export programs, the Export Working Capital Program and Export Express, are too low at $2 million and $250,000, respectively. There is further discussion of these issues in my written testimony. Again, thank you for holding the committee's hearing in New Orleans today and inviting the World Trade Center to testify. We stand ready to assist you and the committee in your ongoing efforts to advance the United States' international trade position. Thank you. [The prepared statement of Mr. Schreiber follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you, Mr. Schreiber, and we always appreciate your comments and suggestions and we value your counsel. Thank you. Ms. Simek. STATEMENT OF DIANA SIMEK, VICE PRESIDENT FOR BUSINESS DEVELOPMENT, ARK-LA-TEX REGIONAL EXPORT AND TECHNOLOGY CENTER, INC., AND MANAGER, METRO/REGIONAL BUSINESS INCUBATOR, SHREVEPORT, LOUISIANA Ms. Simek. Thank you for inviting me. I really sincerely appreciate all the efforts that you have put into trying to help our small businesses. In fact, the two subsidiaries of CDC that I represent, you were the guest speaker when they were announced in 1995, and I thank you for that, too. There is some of the information that Gene talked about that I agree with. One of the sad statistics is that according to the SBA's 2008 report to the President, only 1.6 percent of Louisiana small business with employees export. Think of what we could do to both help better the economy, to create new jobs, and positively impact our trade deficit if we could increase that to even ten percent. Virtually everything--as Gene said, virtually everything in exporting is different from selling to the local and regional economy, but we have so many good agencies already in place that if we look at--if we just could get them to do and be more known to the people that are out there, and that is one of the things is I agree with you. We need to put more information on the web and make it very easy to find. If you look at the SBA's website, you have to dig to find where their international trade is. It is buried underneath capital access. So this goes to some of our recommendations. One is to get all of these agencies to collaborate together more frequently. I think it was obvious from what was said today that it desperately is needed. And rather than spending-- Gene, contrary to you--rather than spending large sums of money and time to create another separate Export Assistance Center through the SBA, because that would mean having to train and find all these new people, it seems to me that developing strong collaboration and referral programs among all of them is what would be in the best interest of small business in the United States. There are a few areas that I would like to address that I think SBA could do immediately with little cost to help small businesses interested in exporting. First is to change the SBA website, because you just can't find anything and they don't refer--you have to go way into it to find any kind of resources. Second, encourage--I didn't realize, and I didn't meet her until today, but I didn't realize she was an ETC, ETM, EMC, or Export Management Trading Company--but encourage the development of Export Management Companies and Export Trading Companies. These companies serve as expert intermediary agencies for small businesses that prefer not to export. We don't have a list of them. So we don't know where to find them. I even called Gene one time and we couldn't even locate one. Mr. Schreiber. Very few. Ms. Simek. So very few. SBA should develop a method to register EMCs and ETCs similar to what they do with the franchise companies for the loans and provide this list of exporting agencies broken down by product type on their website. Encourage small businesses that have won SBIR research grants to export their technologies overseas. SBIR awardees are required to report their commercialization efforts to the awarding agencies. Adding a section to this report dealing with exporting activities could serve as a reminder to the small businesses that they need to think globally when considering future commercialization opportunities. Develop a method--I represent the Business Incubation Association, so I have to think about us--but develop a method to work with the nation's business incubators, which today total more than 1,000 nationwide. Business incubators, especially those linked to the universities and working with SBIR clients, like mine does, we know where the high-tech and the new innovative products are and so we could help make sure that they get some exposure to international markets. And again, the web. Small business owners find it difficult to attend seminars. The Internet offers a great solution in webinars. SBA, in collaboration with other exporter assistance programs, should offer an ongoing series of webinars covering all the important aspects of what a new exporter needs to know. ABC annually publishes a Small Business Lending Report listing U.S. banks that have made SBA loans during the year. A similar listing identifying U.S. banks that provide export loans would be a handy tool for small exporters. And rather than initiate a grant program nationwide, as has been kind of recommended in some of the legislation, a pilot program might be considered and monitored to see if the use of such grant funds would truly benefit small exporters and the nation. Another thought--and I think that Jerry is going to handle this one--another thought would be to examine the possibility of adopting a program similar to USDA's FAS Market Access Program, whereby an organization such as SUSTA would handle requests for government subsidiary funding for exporters. In closing, I would really like to make very clear that I have--my comments about the SBA only refer to the international. I fully acknowledge that they are the premier Federal agency when it comes to offering business counseling and seminars for small business. Their loan programs are excellent. Unfortunately, they are not well used in our area, though, and I regularly refer my clients to SBA's online training programs. Again, I thank you very sincerely for holding this hearing and I welcome any questions you may have. Thank you. [The prepared statement of Ms. Simek follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Well, thank you. I am very impressed with your testimony. You gave quite a few specifics and we appreciate it and thank you very much. And Ms. Castro, we are happy to have you, and you can explain the Export Trading Company, of which you are one, and welcome. STATEMENT OF WILMA CASTRO, OWNER, INTERNATIONAL EXPORT SALES L.L.C., ON BEHALF OF THE LOUISIANA DISTRICT EXPORT COUNCIL, ST. ROSE, LOUISIANA Ms. Castro. Thank you, Senator Landrieu, for the opportunity to testify as part of this panel. Export sales have meant a great deal for my company and my family and I look forward to telling you a bit of my experience. I got into the export business over 15 years ago and I can truly say that every day has been a learning experience. Selling internationally isn't easy. One of the keys to my success has been learning about the resources that can help small companies like mine export profitably. My experience in the international business started in my native Honduras, when I marketed products from Honduras to Europe and the U.S. Years later, I came to America and I started selling supermarket equipment overseas with Interamerica Sales. Next, I worked as an executive sales representative for Albert Rebel and Associates out of California. I managed their New Orleans branch until the year 2000, when I decided to start my own company. Relying on the experience in the supermarket supply industry, I decided to create a business based entirely on sales to Central, South America, and the Caribbean. International Export Sales is classified as an Export Trading Company which specializes in the purchase and resale of U.S.-manufactured equipment, commercial refrigeration and light industrial refrigeration equipment to Latin America and the Caribbean. We offer our customers everything from shopping carts to freezer display units and many things in between. We maintain customer relationships with over 100 international clients comprised primarily of foreign supermarket chains, resellers, and distributors. Our staff has over 20 years of experience in the export business. Even so, I find that it always pays to know outside experts who can help us in tricky situations. One of the wonderful things about being an entrepreneur in the U.S. is the wide array of government resources to help companies sell internationally. I have used a number of these. Today, I would like to talk in particular about the U.S. Commercial Service and the Ex-Im Bank. I always say that customer service is the cornerstone of our business. In fact, our desire to better serve our customers is what led us to work with Ex-Im Bank in the first place. We currently have an export credit insurance policy with Ex-Im. This allows us to extend better terms of credit to our buyers and limit risk to our small company. In today's competitive global economy, I have found that deals can be won and lost because of financing. We have increased our sales by providing open account terms to our best international customers. For example, just a few months ago, we won a major sale in Honduras with the help of Ex-Im credit insurance simply because we were more competitive because of this resource. I would also like to talk about the assistance we received from the U.S. Commercial Service. For years, I have relied on the New Orleans U.S. Export Assistance Center for market research, trade leads, help with export documentation, and contacts in international markets. These trade leads are very specific and actionable opportunities generated by the U.S. Commercial Services staff in U.S. embassies overseas. Timely information like that is a huge help in our marketing efforts. On several occasions, the Export Assistance Center has been instrumental in helping us close a deal. For example, recently, we had a potential customer from El Salvador who contacted the Export Assistance Center to verify that we were a reliable supplier. The Export Assistance Center staff were able to immediately verify that they knew us, they knew me personally, and had even visited our company over the years. With that assurance, we got the sale, so it does help. I am also grateful to the U.S. Department of Commerce for establishing the Louisiana District Export Council, or DEC. The DEC serves as something of an advisory board for the Commerce Department. Its membership includes exporters like me, trade association representatives, Federal, State and local export assistance specialists, and service providers like attorneys, bankers, and freight forwarders. I am honored to be a member of the Louisiana DEC. Together, our members have over 100 years of hands-on trade experience. We act as mentors to new exporters in our State and work with the U.S. Export Centers to develop outreach and other programs. This year, we embarked on an inclusive planning process to identify five core objectives for our DEC. Members volunteered to staff subcommittees to work on action items for each objective. One of these is a Louisiana Exporters' Resource Guide, about which we just met this morning. My fellow DEC members also are wonderful resources for me personally. We share ideas, challenges, and best practices. We get together quarterly to discuss new trade trends and other developments. It is nice to be part of an exporting community. Finally, I should note what a big help the Central America Free Trade Agreement has been to our company. Free Trade Agreements like this one make our products more competitive. We see a direct result between CAFTA and increased sales in Central America. I encourage the Congress to work towards the passage of other trade agreements, such as Colombia and Panama. Before I close, I want to thank Senator Landrieu again for asking me to testify before this committee. I gained my U.S. citizenship last November and I am honored to be recognized for my company's success and to represent American entrepreneurs everywhere. Thank you. [The prepared statement of Ms. Castro follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you. We are very proud to have you as a new citizen of our country. Thank you for your contribution. Mr. Hingle. STATEMENT OF JERRY HINGLE, EXECUTIVE DIRECTOR, SOUTHERN UNITED STATES TRADE ASSOCIATION Mr. Hingle. Thanks, Senator. I really appreciate being part of today's discussion. Again, I am here with the Southern U.S. Trade Association. We are a nonprofit trade association based here in New Orleans that helps companies export, small companies primarily. We are based here in New Orleans, but we do help companies throughout the Southeastern United States. I am going to talk a little bit about the program, who we are, and also highlight the Federal Market Access Program as a resource that is available to small businesses looking to export. Our agency has helped thousands of organizations tackle international markets around the world. We help companies in many ways. We talked about training. We help small companies in training, one-on-one, go to their place of business, coach them how to export. We coordinate a number of trade events around the world, trade shows and buyers' missions around the world. We sponsor their participation in those events. I am sure you recognize some of the Louisiana products here. They are known here locally, rice, Zapp's potato chips, sauces. They are known very well here and increasingly known around the world thanks to their involvement with our programs. All of these products here, we have helped promote abroad their brands. The Department and the Market Access Program, in a number of countries around the world, and increasingly even in places, India and Japan, buying these products on the shelves or in the restaurants. It is really quite a sight to see. The testimony that I turned in has 20 companies listed we have worked with over the last couple of years. You probably recognize quite a few of those companies. Our work is funded mostly by the Market Access Program, or MAP. This is administered by the USDA's Foreign Agricultural Service. It was launched about 20 years ago with the intent of helping farmers and food producers export. There are about 70 groups that partner with USDA to help thousands of companies across the U.S. export. We are all nonprofits, and one of the kind of things of the MAP program's Branded program, where we extend funds directly to companies that go off and promote their brands overseas, and we will reimburse them at half of their cost of doing so, qualified cost, qualified number. It has to be a small business. It has to be at least 50 or more percent of U.S. origin, et cetera. In our region of the U.S. alone, there are hundreds of companies that are now successful exporters as a direct, attainable result of their work with us and MAP program. Just a few years ago, these companies never even considered exporting. We can help you get there. Research commissioned by the USDA proves the program works. Their research says that for every dollar that is in export promotion, some $25 in export sales typically occur through seven years after the fact. In our own research, we asked the folks who take part in our programs. Almost immediately, we are seeing a $22-to-$1 return, I guess you would say. For every dollar we invest in these companies in finding buyers overseas, we are seeing a $22 return, so just right there. On the macro scale, the U.S. spends about $235 million on these programs. MAP is about $200 million each year. It has a sister program, about $35 million. Our competitors--the European Union, Canada, Australia, South Africa, the big players out there--combined spend $1.2 billion every year to do the same thing. That is five times our annual budget to help companies export. And we are losing ground to a lot of these competitors in key markets. The 2008 farm bill, sadly, OMB has proposed a 20 percent cut in the program, from the current $200 million by 20 percent. There appears to be some confusion. I think that there is belief that it benefits large companies, but by definition is only for and by the small companies. There is confusion there, and they do cite some arguments that this is specifically rejected on many House and Senate floor votes over the past 15 years. So there is a lot of confusion over the program in Congress. I think there is some confusion right now for next year. We know the program works well. We know for a fact that users out there, hard data and anecdotal, the information we know of is that the program works well, and we think it aligns perfectly with Washington's goal to create jobs locally and build sales and jump start the economy. We know that it is helping create local jobs as well as generating sales internationally. So we are urging Congress to keep the program as it is, intact as written. Basically, it is not broken, so let us not try to fix it. [The prepared statement of Mr. Hingle follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Chair Landrieu. Thank you very much. It has been very helpful. We have got a few minutes for questions, and let me, if I could, Mr. Hingle, start with you. I am very interested in this particular program and its applications, of course, coming out of the Agriculture Department, but many have applicability throughout what the subject of this hearing is today, particularly on the training and outreach, recruiting opportunities, et cetera. We are learning how the mark program was started. Was it a Congressional authorized program or was it something started either with or adjacent to the Agriculture Department? Remind me of that. Mr. Hingle. Its origins were within USDA. I can't speak to the whole issue of it. I can certainly find out for you. Chair Landrieu. That is okay. Staff will check on it, because I am very interested in that particular model, and if the staff has any information, you can slip me a note about it. But I think that it is an excellent model, and, of course, representing a State that has a strong agricultural base, I am very familiar with the opportunities and the pressure from the farmers who are looking for other markets for their products. It is very, very important, and, of course, they are pretty much front and center on some of these trade agreements. But the finished products are not just the crop itself or the commodity itself. It is also interesting in the way you have outlined how that program works, so we will follow up. Let me ask each of you all, and some of this is in your testimony, which was excellent, for the record, but if you had to, starting with you, Mr. Schreiber, say one change that you would recommend at the Federal level, just one change that you would recommend that might really help to increase the number of small business exporters, what would that one change be? Mr. Schreiber. Well, I will reiterate. In real estate, it is always location, location, and location. For me, after many, many years of this, I have concluded it is all about training and planning your export future. That isn't done by hardly any companies. They jump into it. They say, well, it is just like the U.S. I will go over there, or Canada. I will start selling. And I see examples of companies lose their shirt or lose their company because they made a mistake that would not have cost them one penny to eliminate if they had simply been trained properly. Now, the training is tedious and dry. I won't say boring. I think it is very exciting. But it is dry. But if you don't have the vocabulary, if you don't have these rules and regulations-- we know how many rules and regulations there are in our country. Well, multiply that by 200 countries around the world. So I think it is this basic training that we always pawn people off to somebody else. Oh, go see so and so, or go see the freight forwarder. But not many organizations, and that is especially true in Louisiana, which I am very familiar with--it is not being done sufficiently in Northern Louisiana because, compared to a shopper who doesn't travel now because of restrictions, I am not sure in Northern Louisiana who is doing that nitty-gritty training of the forms, not the programs that are out there, but how do you--what do you actually do. Chair Landrieu. Ms. Simek, what would you say? Do you agree with that, and if so, you can expand. But if you don't, what is the one thing you would change? Ms. Simek. I truly believe that we do a very poor job throughout the entire country, including Louisiana, in teaching people about entrepreneurship. So it goes beyond the training. We are still--continue through our educational system to train people to work for a General Motors. If you look at where we are, we don't--and as part of the entrepreneur--I would love to see entrepreneurial training and more respect for the small business people. And in part of that, we need to talk about the export, the potential. The United States has always been a country that was so lucky because we had such a large population, we didn't have to export. If you wanted to export to Europe, you had to do it individually, France, Netherlands, whatever. Now, they have got the EU, so now they are competing with us and we don't know how to do this. And so we need to get classes back into the universities, if nothing else. We need to have some classes that are not through a counselor, but through a course that we should have, and we don't have that now. And maybe that would be beyond the entrepreneurship, but just have something that focuses in on teaching people how to--all the things that are involved in exporting. Mr. Schreiber. The universities do not teach this, by the way. Chair Landrieu. Well, I was sitting here thinking of our 21 universities that we have, Mr. Cravins? I think we have 21 Louisiana universities, as I recall, and it would be interesting to follow up on that. Ms. Castro, what do you think the one change could be and do you agree that this training is a component, and also--three questions for you--how did you train? And use the microphone, if you would. Ms. Castro. Okay. I was hearing what they were saying. I do 100 percent of my business is overseas. What can I say about how to train or what is the requirement or--I don't know. I believe in traveling, but to travel, you need to have a contact, right. So I guess my contacts have been through word of mouth from one customer who you are doing business and becomes one. Right now, I don't know how to think or what to do or say about how to train them, because I have had all kinds of experience. Experience is open and counts as real, whether it is Ex-Im Bank experience--and actually sitting here right now, I have supermarkets asking me to get store resources from Louisiana distributors of food, that they want to import in Central America. Why? In Miami, they get all the business. But Miami knows it and the prices are not very competitive. So actually there is a big company called Napco. I have been training him, and I brought him customers. I sell the equipment. I brought him the customers for him to--I mean, well, we did it like a deal, but it is a way to start. He doesn't know how to start. So I said, okay, my job here in this case in the supermarket is selling equipment. I bring him customers. Now, in their case, they want to learn how to--say exposure, I guess, how to do it, how to get a contact. What are the steps of the process? I would say the first thing you do is I believe in those trips that are organized by the---- Chair Landrieu. Chamber of Commerce sometimes, and others. Ms. Castro. So you go to the company, country, and it is a good point to start, because there you meet what they want, one to one. Later, somebody asked me what is the risk. Well, everything in life has a risk, but if you insure your product, the risk is---- Chair Landrieu. It can be minimized. Ms. Castro [continuing]. Minimized. But it is never--to me, it is very important you face and you see the firms. It is very important. Chair Landrieu. Mr. Hingle. I hope that you all have gotten some good ideas together, that you all can exchange cards or we can expand opportunity right here. That is one of the real benefits of these forums. Go ahead, Mr. Hingle. Mr. Hingle. More broadly is collaborational outreach. I think that is the biggest challenge that we see right now. We heard a lot earlier today about needing collaboration, collaboration, collaboration. Well, I have two full-time staff who are out there knocking on doors every day, trying to find new companies to take on the programs. SBA does the same, my dear friends, doing the same, trying to make more companies aware of programs that are out there. And we are all out there doing this. We are all out growing, but we are in the same boat. And I think that the training is one of the many components that we can offer these companies. Some are very senior and seasoned exporters already simply need our assistance by the way of export promotion or finance. So I would say that is the biggest challenge we face right now. I would like to see more collaboration on the outreach efforts, among all the different agencies we talked to today. Chair Landrieu. Okay. Let me ask this. Ms. Castro, you mentioned the travel is very, very important. You discussed how the U.S. Commerce Export Assistance Center was helpful in bringing businesses or individuals overseas. The annual budget for this program has gone down over the years. What would you say to members of Congress--and you sort of said this, but I am going to give you an opportunity again--what would you say to the members of Congress that want to either eliminate or reduce this program, and how important is it, do you think, for small businesses to be able to meet face to face to begin to develop relationships that might result in business trade and export? Ms. Castro. I think that it should continue this program, because not only that--there is a recession in this country. I, on the other hand, have no problem. I mean, my business is overseas. If what happened is overseas--of course, I work with the Caribbean a lot and Central America. When the U.S. has going down, like right now, the equipment, the metal, okay, so what these companies do overseas is they start to see the opportunity to buy---- Chair Landrieu. To buy it at a lower price. Ms. Castro. So that is when my---- Chair Landrieu. Your business increases. Ms. Castro. It increases. Everybody says to me, do you have it? I have the money--because a lot of them, the problem is that they--the Ex-Im Bank, it is good, but at the same time, the paperwork is so tedious. My people, I have full time, and they take so long. So the only one that I have finally made a deal was for $1,100 and we got it quick. But there are a lot of people right now interested in the--and come back to, I want to promote over there. But yes, the business overseas, there is a demand. Chair Landrieu. Well, let me tell you, one of the things that I want to do is do an informal roundtable with the Ex-Im leadership. I mean, Fred was here, but we need to do--and he is still here? Fred? Good, you are listening to this. I would like to do an informal roundtable with some of these business owners so that they can really talk specifically with the Administrator about how to reduce this paperwork associated. Of course, you know, we have an obligation to the taxpayer to verify and we have to be careful when we are lending taxpayer guarantee because taxpayers like to be repaid in full with interest, if appropriate. But given that, I think there are some excellent examples that you shared with your own company and we are proud to see companies like this growing. Let me see if we have a question for the entire panel. The SBA's core programs include both lending and counseling, and we are considering giving the SBA a more robust role in export promotion. Now, the Department of Commerce primarily has the leadership. We have talked a lot about coordination. But would any of you want to make any suggestions in terms of the SBA network, how maybe it could better serve this export opportunity for small businesses? Mr. Schreiber. Mr. Schreiber. I would rather not comment on it, because I am not in the bureaucracy. What I would say because I am outside the bureaucracy, and the members of the World Trade Center are, I don't really care who does the work as long as they do it well. And that is not only coordination, it is hiring good people. In life, I mean, the greatest game plan in the world might not be successful because you don't have a terribly capable person doing it. So I guess we sort of look to you, the oversight in Congress and the leaders who spoke here today of those agencies to work out the details and deliver a product that is understandable and usable and logical. But we don't really get into the TPCC or whatever. Most of us have no idea what they mean, what they talk about, but we know that it is important. But we are down at the working level, I am afraid, and just want to see the results. Chair Landrieu. Very good point. Ms. Simek. Ms. Simek. I know that the SBDCs have annual meetings where they are trained. Rather than trying to train them in exporting, because as you say, it is very difficult, and truthfully, when we exported, we went to the freight forwarders. We found somebody else. But what I would suggest is that they get an overview of what it is that the other exporting agencies do so they become very familiar, and then you have resources. Rather than them trying to counsel a small business that manufacturers food products, get them in contact with the FAS program, the SUSTAs. And so that is what I would strongly suggest, is that there is better coordination, better information, better training than just the SBDC center, than trying to put an export consultant in each one of their offices. I don't see how they could afford it, because you are going to end up with--the quality is going to be different, and so depending on where you live, on each State, you are going to get better or worse. So I think we already have a very good network, and truthfully, the DECs are great resources. Let us see how we can use them. Let us see if we can't get all these organizations actually honestly working together for the betterment of the companies and for the nation. Chair Landrieu. Thank you so much. Our time for adjournment is near. I want to just say a few closing comments. One, I hope that you will all pick up the Guide to Louisiana Small Business. Our office is proud to have produced this. We will be producing it in Spanish, based on a comment from the Hispanic Chamber this morning. But it is our attempt to at least put all of the Federally supported and some State-supported entities that deal with small business on one-- in one document with websites attached, and we are going to do our best from our committee to really have the Federal Government coordinate, not only better to itself with quality programming and aggressive outreach, but coordinating with the State level and local level and nonprofits to really create a country of entrepreneurs and a country of entrepreneurs capable of export. And where we believe--I believe, I should speak for myself--I believe that the road out of this recovery is going to be led by small business and they are going to have to find opportunities, whether in the 50 States, the economy of the 50 States, but also try to find opportunities in the world economy. And there is no reason that the government can't do a better job, with new technologies and emerging technologies, exciting opportunities. The world is truly becoming smaller and I just think that they need a little more focus and work. That is what our committee is charged, and one of my visions. I share that with my Ranking Member, Olympia Snowe. I want to recognize that her senior counsel is here, Mr. Wally Hsueh. Would you stand, Wally? Wally is in the back, and we appreciate the Republican Staff Director being present. We work in a very bipartisan fashion on this committee. I want to thank my State staff and Don Cravins, my Staff Director. He and his staff have organized two very productive days in the city, in the region today. We had a reception last night. We had standing room only. This morning, hundreds of small business owners showed up at the University of New Orleans for a general small business outreach conference. Then we did a tour of Lakeview, of the Lower Ninth Ward, of the Upper Ninth Ward, visited with business owners on the ground, conducted this hearing, and we are ready to stop working for a few minutes. Go ahead, Mr. Schreiber. Mr. Schreiber. Senator, can I make one important point, and you are very aware of this point. We want to thank you, Senator, for your leadership last year with the entire Louisiana delegation on an important matter related to CAFTA, the Dominican Republican CAFTA Free Trade Agreement. We hope you will follow up--I don't know if he is here--with Ambassador Kirk, because you crafted, you and the delegation, a joint letter that went to President Bush requesting that the administration consider New Orleans as a site for meetings and negotiations under the CAFTA agreement. There isn't a Secretariat of CAFTA, and so the thought here was, and by you, to, well, let us make New Orleans the de facto Secretariat by holding these negotiation meetings and other events that they hold, instead of always meeting in Washington or in the respective countries, get out of Washington, and not only would New Orleans be the perfect location for reasons we all know, but it has been demonstrated. Last year, in fact, the day you wrote that letter that you and the delegation did to President Bush, he was here with the President of Mexico and the Prime Minister of Canada at the Summit of the Americas. And previously in the negotiations--this was seven or eight years ago--New Orleans was one of the cities selected for negotiations under CAFTA. So what a perfect location and helping in the recovery process and combining it with tourism, economic development, and business. And let us face it. We know that the Latin Americans, the Central Americans, will love New Orleans and would jump to come here. So we request your further leadership with Ambassador Kirk and the administration following up on this. Chair Landrieu. Thank you. Excellent suggestion. Is there any further business? If there is no further business, meeting adjourned. [Whereupon, at 3:05 p.m., the committee was adjourned.] APPENDIX MATERIAL SUBMITTED ---------- [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]