authorized by the Bank from the time of its establishment in February 1934 to $6.3 billion. As of June 30, 1953 the total amount disbursed under such authorizations was $4.1 billion. Of this amount $1.6 billion has been repaid.

Loans outstanding on June 30, 1953, amounted to $2.5 billion and the unutilized portion of established active credits was $7.91.3 million. Thus, the uncommitted lending authority of the Bank stood at $1.2 billion at the year end.

Organization

On April 30, 1953, the President transmitted to the Congress Reorganization Plan No. 5 (appendix H), prepared in accordance with the provisions of the Reorganization Act of 1949, as amended. This reorganization plan provides for the elimination of the Board of Directors and the transfer of all of its functions to a Managing Director to be appointed by the President with the advice and consent of the Senate. The Managing Director will be assisted by a Deputy Director, also to be appointed by the President with the advice and consent of the Senate, and an Assistant Director to be appointed by the Managing Director under the classified civil service. The reorganization plan became law on June 30, 1953, and will become effective when the Managing Director takes office.

Operations

The new credits authorized during the 6 months under review are described in detail in Chapter II of this report. The Bank obtained participation by private capital in 5 of the 9 credits authorized. This conforms to the statutory requirement that the Bank shall supplement and encourage but not compete with private capital and adds to the total of private investment abroad that has been directly encouraged by the Bank's operations. A loan by the Bank for a sound project overseas not only provides the private investor with some of the dollars needed to purchase capital equipment and technical services in the United States but also encourages the investment of private funds in projects abroad which might not have been 3

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ment.

An analysis of all of the credits which the Bank has authorized during the past 5 years directly to private enterprises, or to governments for relending to private entities, indicates that for every dollar loaned more than $1.50 of private United States and private and public foreign capital has been invested as a direct result of the Bank's lending.

During the past 6 months the Bank has continued to make loans to develop and expand foreign sources of essential materials required for strategic reasons and for the use of United States industry. In this category the Bank committed an additional $30 million to aid in financing the construction of new uranium production plants and related facilities in the Union of South Africa. In addition, two credits previously authorized for the production of sulphur and manganese concentrates in Mexico were increased.

One effect of the Bank's loans is to improve the dollar exchange position of the recipient countries to an extent which is sufficient not only to service the dollar loans thus incurred but also to permit a considerable expansion of general imports from the United States. For example, during the fiscal year 1953, two strategic materials credits were authorized with a total commitment of Bank funds of $57.5 million. On the basis of conservative estimates of ore reserves and market values, these two projects alone will produce for export, mostly to the United States, minerals with an annual value of more than $35.2 million. Net dollar exchange earnings to the countries concerned from these two projects alone will be in excess of $27 million per year.

Short-term commodity credits totaling $52 million to Japan and Spain were approved during the past 6 months for the export of United States cotton needed for the textile industries of both countries. A credit of $300 million to Brazil was authorized in February 1953 to assist that country in liquidating its past due dollar accounts in order that Brazil might place its commercial transactions on a current basis. This action was taken in order to avoid an interruption in the trade between the United States and Brazil which is so important to both countries.

In May 1953 the Congress enacted Public Law 30 authorizing the Export-Import Bank to provide insurance against certain risks in connection with tangible personal property of United States origin which is located in any friendly foreign country. The coverage is for the benefit of citizens and corporations of the United States who have retained an interest in property exported from the United States in commercial intercourse. The insurance, which is to be provided in an aggregate amount not in excess of $100 million outstanding at any one time, is limited to the risk of loss or damage resulting from hostile or warlike action in time of war or peace including expropriation. This service may be provided by the Bank only to the extent that it cannot be obtained from the private market on reasonable terms.

At the close of the fiscal year, rules and regulations for issuance of insurance through private channels were being prepared.

Field Investigations

It is the Bank's policy to make careful investigations and follow-up inspections of an economic, financial and engineering nature in countries where the Bank has outstanding loans or from which the Bank has applications under consideration. Experience has shown that this practice is a more effective and more economical procedure than establishing field offices in countries in which the Bank has active lending operations. During the past 6 months representatives of the Bank traveled to Afghanistan, Egypt and Israel in the Middle East; Brazil, Chile, Colombia, Ecuador, Mexico and Peru in Latin America; and to Canada and Spain.

CHAPTER II

Lending Operations Under ExportImport Bank Act of 1945, as Amended

Appendix A summarizes the operations of the Export-Import Bank since its establishment in February 1934. New credits authorized by the Board of Directors during the 6 months ended June 30, 1953, are listed in table 1 and briefly described below. Table 2 lists allocations approved by the Board during the same period for specific projects or purposes within lines of credit previously authorized. These are also briefly described below.

These summaries do not include operations under the Economic Cooperation Act of 1948, as amended, nor credits authorized under section 302 of the Defense Production Act of 1950, as amended, nor loans made pursuant to the Mutual Defense Assistance Act of 1949, as amended. Operations under those acts are carried separately on the books of the Bank and are described in chapter III.

Appendix B summarizes the operations of the Bank by countries and areas. Appendix C describes the status of all loans on June 30, 1953. Appendix D summarizes transactions with commercial banks as of June 30, 1953, under reimbursement agreements with the Bank. Appendix E indicates the principal and interest due in future years on loans outstanding as of June 30, 1953.

Brazil

New Credits

A line of credit of $300,000,000 in favor of the Banco do Brasil, S. A. was approved in February to assist Brazil in