## Press Release: IMF Executive Board Renews US$48 Billion Flexible Credit Line Arrangement with Mexico

_IMF News, March 25, 2010_

## Source details

**Canonical URL:** [Press Release: IMF Executive Board Renews US$48 Billion Flexible Credit Line Arrangement with Mexico](https://www.imf.org/en/news/articles/2015/09/14/01/49/pr10114)

## Other formats

- [Markdown version](/en/news/articles/2015/09/14/01/49/pr10114/index.md)
- [Structured JSON version](/en/news/articles/2015/09/14/01/49/pr10114/index.json)
- [Bundle manifest](/en/news/articles/2015/09/14/01/49/pr10114/bundle-manifest.json)

## Bibliographic details
- Published: March 25, 2010

---

### Key decision and terms
- The Executive Board approved a successor one-year arrangement for Mexico under the Flexible Credit Line (FCL) in an amount equivalent to SDR 31.528 billion (about US$48 billion).
- The Mexican authorities stated they intend to treat the arrangement as precautionary and do not intend to draw on the line.
- Date of press release: March 25, 2010.
- The FCL was established on March 24, 2009 as part of a major reform of the Fund’s lending framework (see Press Release No. 09/85).

### Purpose and features of the Flexible Credit Line
- Designed for crisis prevention purposes and provides the flexibility to draw on the credit line at any time.
- Disbursements are not phased nor conditioned on compliance with policy targets as in traditional IMF-supported programs.
- Flexible access is justified by the very strong track records of countries that qualify for the FCL, which gives confidence that their economic policies will remain strong.

### Assessment of Mexico’s policies and macroeconomic framework (statement by Mr. John Lipsky)
- Mexico has a sustained record of sound economic policies, and has very strong economic fundamentals and frameworks.
- Public and private debt levels were reduced and balance sheets strengthened in the years before the global crisis.
- Well implemented rules-based policy mechanisms include:
  - the balanced budget fiscal rule,
  - inflation targeting framework,
  - flexible exchange rate regime.
- These mechanisms have anchored stability and helped preserve stability during the crisis.
- For the first time in many decades, the authorities were able to deliver a sizable countercyclical fiscal and monetary policy response.
- Adroit steps were taken in various financial market segments to maintain orderly conditions.
- Authorities demonstrated commitment and ability to reform during challenging times, including through the passage of important revenue measures in the 2010 budget that will strengthen the medium-term fiscal outlook.
- Swift action to secure contingent credit lines during the crisis—from the U.S. Federal Reserve and the International Monetary Fund—helped maintain external confidence.

### Recent developments and outlook
- Growth has resumed since mid-2009.
- Asset prices have recovered from troughs seen at the height of the crisis.
- Domestic financial stability has been maintained.
- Policies will continue to be underpinned by the rules-based macroeconomic framework, and the authorities intend to continue to react as needed to any future shocks.
- Sizeable downside risks still confront the global economy.
- The successor one-year FCL arrangement is intended to be precautionary and to:
  - continue to play an important role in supporting the authorities’ overall macroeconomic strategy,
  - bolster confidence until external conditions improve,
  - complement financing from other multilaterals.
- Mexico’s strong policy frameworks and economic fundamentals, together with the additional insurance provided by the successor FCL arrangement, place Mexico in a very strong position to deal with potential risks as the global economy gradually recovers from the crisis.

*Press Release No. 10/114, March 25, 2010.*

---

## Content in this bundle

- [Cr1081pdf (PDF)](/-/media/websites/imf/imported/external/pubs/ft/scr/2010/_cr1081pdf.pdf){rel="external" type="application/pdf"}

---

## References

- [Mexico and the IMF](http://www.imf.org/external/country/MEX/index.htm)
- [Press Releases](https://www.imf.org/en/news/searchnews)
- [PRESS CENTER](http://presscenter.imf.org/)
- [Press Release No. 09/85](https://www.imf.org/external/np/sec/pr/2009/pr0985.htm)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2015/09/14/01/49/pr10114_