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• China’s export credit activity is greater than that of the ECAs of the entire G7 combined. Today, China is the world’s largest official creditor, maintaining a portfolio more than twice the size of the World Bank and International Monetary Fund combined.

• China’s highly aggressive Belt and Road Initiative, which has prompted international criticism for ensnaring the developing world in “debt-trap diplomacy,” has created a sphere of economic and strategic influence that includes about 150 countries, rivaling the relationships of the United States and her allies.

Unlike America and the G7 economies, China does not subscribe to the rulesbased order that has governed export credit financing for nearly a century. As in so many other things, China plays by its own rules and is opaque in how it operates, weaponizing its export credit financing deals by offering developing nations terms that are often “too good to be true.” Once the project is underway, the Chinese have been known to change the terms, making a project unaffordable for the purchasing country. These tactics have yielded China important strategic plunder like mines and critical minerals, satellites, and even ports like those in Hambantota, Sri Lanka, and Mombasa, Kenya.

Export credit is a strategic weapon in China’s whole-of-government approach to enhance its global power, economic might, and national security. The only country that has the economic heft to counter China’s aggressions in export credit financing is the United States. Not only do American companies risk losing out to Chinese competitors for international opportunities if EXIM is not there to offer support, but a United States without a functioning export credit agency also leaves an unchecked China with a wide-open field to claim jurisdiction over swaths of ocean and shipping lanes, expand its economic influence, and create major changes in the global balance of power.

In response to Chinese aggression in export credit, the ECAs of other countries have reacted defensively to change their policies and programs to avoid losing access to large chunks of global markets. Many countries, including strong US. allies like the United Kingdom, Canada, Japan, and Italy, have changed the mission of their ECAs from one of leveling the playing field for their exporters to hunting proactively for transactions for their businesses and advancing their national strategic interests over the long term. In addition, foreign buyers, particularly those looking to build large international projects, have been indicating that the availability of government-backed financing is a core component of their evaluation of bids and identification of sourcing. Allied nations have taken steps like lowering their content requirements in order to lure more deals, often at U.S. expense.