CAN AMERICA WIN LA GUERRE?
A war is brewing between the Americans and the French over the developing art of mixed credits, the blending of development aid with export credit.
The Americans accuse the French of using these credits to create unbeatable bids in the battle for foreign business.
For years the Americans stood back and complained, but last November the US Eximbank decided to meet the French headon with a volley of bids backed by mixed credits. Eight times the US sallied into the fray, expressly against French bidders. So far, it has been successful only once.
"It's kind of compliment to French innovation,' remarked Jacques Joutard, assistant director of the Direction des Relations Economiques Exterieures (DREE). That is putting it kindly. Others see the American stance as hypocrisy. The United States already ties its commodity aid to medium-term credit, say critics. And American protests arise from qualms about their self-inflicted trade deficit.
The US opposes mixed credits on the grounds that they distort both trade and aid. Chief standard-bearer is William Draper III, president and chairman of Eximbank. In Paris at the OECD meetings in late January, he told Euromoney: "It's like mixing oil and water--it's not good to drink and it doesn't move your car.'