June 30, 1995
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Michel Camdessus, Managing Director of the International Monetary Fund (IMF), said that the IMF's Executive Board today reviewed the progress Mexico has made in implementing its economic stabilization program. As a result of this review, the Executive Board set the terms for disbursing to Mexico the remaining SDR 6.8 billion (about US$10.7 billion) 1 under the stand-by credit for SDR 12,070.2 billion (about US$18.9 billion) approved on February 1, 1995.
Under the decision, SDR 1.29 billion (about US$2 billion) will be available immediately. The remainder will be made available in five equal installments of SDR 1.1 billion (about US $1.73 billion each) --beginning August 1995, through August 1996, subject to continuing satisfactory performance.
Camdessus said that, since Mexico adopted the economic program to deal with its financial crisis in early 1995, its trade and current account balances have dramatically improved, the peso has recovered from its lows of early-March, foreign reserves have risen sharply, interest rates have fallen, the stock market has recovered, and the budget surplus has exceeded forecasts.
"Provided Mexico continues to pursue prudent financial policies and structural reforms, there should be a return to economic growth in 1996 and beyond and a reduction in inflation to international levels, contributing no doubt to a further strengthening in market confidence," Camdessus said.
