Export Promotion:

Federal Programs Lack Organizational and Funding Cohesiveness

NSIAD-92-49: Published: Jan 10, 1992. Publicly Released: Feb 13, 1992.

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Pursuant to a congressional request, GAO reviewed the federal government's export promotion programs, focusing on the: (1) rationale and resources devoted to those programs; and (2) adequacy of recent attempts to consolidate and streamline those programs.

GAO found that: (1) in fiscal year 1991, the U.S. government spent $2.7 billion on export promotion programs and $21.4 billion on export loans, export credit guarantees, and export insurance; (2) funding for the ten executive branch agencies involved in export promotion is not made on the basis of an explicit governmentwide strategy or set of priorities; (3) agricultural programs receive the most funding even though the agriculture sector only accounts for about 10 percent of total U.S. exports, and a significant portion of that goes to large established U.S. firms; (4) in 1990, the President created the Trade Promotion Coordinating Committee to cope with export promotion; (5) the Committee has achieved some success, but has not addressed the issue of how to consolidate the government's export promotion programs; and (6) the Committee faces several obstacles to achieving its goal of unifying the government's export promotion programs, since the Committee lacks permanence and does not have the authority to set programs or budget authorities across government agencies.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: In October 1992, P.L. 102-429 became law. This act required the administration to devise a governmentwide plan for export promotion and a unified export promotion budget, and to ensure budget requests conform to that plan's priorities.

    Matter: To help ensure that export promotion programs achieve increased organizational and funding cohesiveness, Congress should require the executive branch to formulate governmentwide export promotion strategy. Congress may wish to consider requiring that the programs be integrated into the governmentwide strategic plan and funded in a manner consistent with the emphasis given them under the plan.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: As required by P.L. 102-429, TPCC issued governmentwide strategic plans for export promotion programs in September 1993, 1994, and 1995. The plans responded to the general thrust of the recommendation and provided for numerous improvements to the federal export promotion system. However, they did not completely fulfill two of the law's requirements. TPCC continues to identify governmentwide export promotion priorities in terms of export markets, programs, and policies, though member agencies have exercised flexibility in focusing their efforts. TPCC has consolidated the export promotion budgets of its member agencies into a series of TPCC-wide presentations that foster better understanding of historical and prospective expenditures. However, while TPCC has made efforts to develop interagency performance measures, it has yet to create measures that are sufficiently refined to influence budget reallocation decisions, which GAO views as an essential part of the unified budget process.

    Recommendation: The Secretary of Commerce, as chair of the Trade Promotion Coordinating Committee, should work with other member agencies and the Director of the Office of Management and Budget (OMB) to: (1) develop a governmentwide strategic plan for carrying out federal export promotion programs; and (2) ensure that the budget requests for these programs are consistent with their relative strategic importance.

    Agency Affected: Department of Commerce

 

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