Export Assistance Program

National governments have a vested interest in a high export quota. Not only do exports allow for the accumulation of foreign exchange reserves, exports also increase employment levels, improve productivity, and foster overall prosperity. At the same time, governments recognize the formal trade barriers and the practical challenges that companies, especially small and medium-sized ones, face in global markets. Therefore, governments, semi-government institutions, associations and other nonprofit organizations, banks, and other institutions offer support mechanisms in the form of export assistance programs or, as they are sometimes also called, export marketing programs, export promotion programs, or trade promotion programs. While the overall aim of all export assistance programs is to raise firms' competitiveness abroad, the detailed measures taken and instruments applied may vary greatly from country to country.

The support national government export assistance programs offer falls into one of five categories: (1) awareness-building and stimulation of interest, (2) acquisition and distribution of information, (3) training and capacity building, (4) consulting, advice and coaching, and (5) financial assistance. In the area of awareness-building, the basic challenge is that in most national economies, only a small fraction of all firms is actively engaged in exports. Export assistance programs try to increase the share of exporting firms through public-awareness campaigns, media reports, seminars, or conferences.

As far as acquisition and distribution of information is concerned, export assistance programs aim to help identify information needs. They fulfill them through the use of databases or through staff at their own offices abroad. The type of information needed can be very diverse. It stretches from general market information or country risk ratings to complex market data to detailed legal questions. Training and capacity building are of utmost importance to exporting companies. The services of export assistance programs in this area range from simple handbooks to seminars and workshops to whole programs on exporting.

The range of services in the consulting, advice, and coaching category includes simple and practical advice for export beginners as well as more complex tasks such as the organization of trade missions, [Page 640]participations in trade shows, the collection of outstanding bills, or the registration of trademarks. These services are often provided by staff at the export assistance program's head office in the home market or by foreign trade offices abroad. While such foreign trade offices are integrated into embassies in some countries, they are independent in other countries. Financial support services, e.g., in the form of export credit insurance, export loans, or export guarantees, are often provided by national governments or specialized banks affiliated with governments, e.g., export-import banks.

Export assistance programs not only have to be permissible under the anti-subsidy rules of the World Trade Organization (WTO), they also must function efficiently. Various measures have been used in order to test the effectiveness of export assistance programs. Depending on methodology, instruments, countries, and the institutional environment, the results are mixed. They show everything from clearly negative to highly positive correlations between export assistance programs and export success.

With changes in the international business environment, national export assistance programs are also being reinvented. As international trade is becoming ever more important, the future will bring export assistance programs that have been redesigned for new target groups, offering new services through new channels of information and distribution.

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