...if Comair defaults on their Ex-Im guaranteed loan, then the Government of South Africa is on the hook for it, directly indemnifying the US Government for its guarantee.What a circle jerk. "Guaranteed" by who? Don't give me that "South Africa on the hook $hit. Why else would the US Congress be involved?
In case you don't know it dimwit "the US Government" is ME.
In case YOU don’t know it, DIMWIT, the US government is US.
The reason the US government is involved in export finance is the same reason France is involved, Britain is involved, Japan is involved, all up and down the line. There is no way there is never an agreement on sovereign debt without both governments’ involvement.
A US company does not want to deal with a South African bank to get paid, the South Africans don’t want to have to go to the US is the US company defaults. The export guarantees offer a way that responsibility can be underwritten to the benefit of buyer and seller - and taxpayers.
This BS about subsidies is bull. There is no subsidy, there is only an interest rate that reflects lower risk to the bank.
I have never read more crap on a single subject than I have about export financing. We can do without it, and maybe we will, but folks getting on their high horse over this as a matter of principle are off base. This is nothing more than remaining a competitive exporter in the modern world, that’s all.