Export Promotion:

Rationales for and Against Government Programs and Expenditures

T-GGD-95-169: Published: May 23, 1995. Publicly Released: May 23, 1995.

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GAO discussed the rationales for and against the operation of government export promotion programs. GAO noted that: (1) supporters have justified export promotion programs for job creation and deficit reduction and the enhancement of trade policy objectives, but there are no empirical data on the programs' effect on such issues; (2) many economists believe that government intervention in private markets makes these markets less efficient, but other economists believe that, under certain limited circumstances, government intervention can improve market efficiency; (3) export promotion programs can offset foreign governments' subsidies for their countries' exports in order to equalize competition; (4) export promotion programs provide export subsidies, foreign market information, government advocacy for U.S. businesses, and financial assistance for both exporters and importing countries; (5) the government needs an unified strategy for export promotion to efficiently allocate funding and reduce costs; and (6) prime candidates for consolidation, termination, or redirection include food assistance and cargo preference programs, and the Market Promotion, Export Enhancement, and General Sales Manager Export Credit Guarantee Programs.

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