New-York tribune., 1919-03-26
Billion-DOllar Fund
Soon To Be Opened
To U. S. Exporters
War Finance Corporation
Prepares Regulations to
Govern Making of Loans
to Finance Foreign Trade

WASHINGTON, March 20. The
governments l,000,000000 fund for
financing foreign trade soon will be
opened to Anne rican exporters through
loans from the War Finance Corpora
tion. Regulations now being prepared
will provide for the lending of sums
up to $5o,0O0,0O0 to any individual
firm. corporation or export association,
probably at GA per cent, for maxi
mum of five years, on adequate collat-
eia1.
The nature Of this collateral security
to be accepted remains TO be worked
out by the corporation. but tdicnl ions
arc that paper representing mcttlan
disc engaged in tho export process viii
So acceptable. Collateral to the extent
,f l2b por cent Of the loan probably
will be required, md loans will be made
either direct TO tho exporters or
through banks.
Scores of Applications
Scores Of informal npplcntions for
information or for advances have been
received from individual exporting
firms or representatives. Of the export
associations being organized under the
Webb act the War Finance Corpora
tion reported to-day. Preparations for
making the loans will be rushed in
spite of the enormous burden thrown
upon the corporation through the ne
ccsslty Of making large advances to the
railroads.
Reports indicate that exporters arc
planning to make extensive use Of the
governments foreign trade fund as
soon as the regulations arc completed
and tho corporation Is ready to accept
formal applications.
This is caused by three principal IN
nucnces
First. European countries which will
need great quantities Of American ma
tcrials during the next year or two FOR
reconstruction and TO make up for lack
Of constructive enterprises during the
war; have neither tho gold nor the
credits to pay for their purchases in
this country and their inability will be
increased when at the end Of the war
the United States government stops
making loans to the Allies.
Exchange Rates
Second, foreign exchange rates, fol
lowing removal of artificial govern
mental influences by Great Britain,
France, Italy and the United States
last week, have produced situation
in which American goods would cost
foreign purchasers much more than
their value in dollars at this time if
purchasers we're forced to pay cash
AS a result, American exporters must
sell on credit if they are to sell in
the quantities needed abroad and the
War Finance Corporations fund will
provide a means Of pooling these cX-
ports credits under government super
vision.
Third. American banks have no. been
accustomed to financing export trans
actions and cannot legally advance as
large sums as may be needed to finance
large exports operations. Nor can they
ninety days, whereas for most foreign
trade transactions Il year or eighteen
montns are needed on credits.
1t is the last condition which has
driven export organizations to the War
Finance Corporation, since the law pro-
vides that the corporation may make a
loan direct to exporters only if loans
cannot be obtained through regular
banking channels at reasonable terms.
Eighty export organizations of
manufacturers have notified the Fed
eral Trade Commission of their intcn
tion TO operate under provisions of
the act
Among the principal commodities
represented in the export association
already developing are steel. copper,
lumber of various kinds. textiles. au-
tomobiles, machinery Of varied styles.
raw cotton, sugar, magnesia, paper,
tanning materials, phosphate, oil and
munitions.
One association would limit its for
cgn trade to clothes pins.