Book contents
- Frontmatter
- Contents
- Preface
- Overview
- Part I Argument
- Part II Epoch I: 1820s–1860s
- Part III Epoch 2: 1860s–1910s
- Part IV Epoch 3: 1910s–1950s
- Part V Epoch 4: 1970s–1990s
- 11 The good guys get tired: Mexican debt rescheduling in the 1980s and 1990s
- 12 The politics of confrontation: Peruvian debt rescheduling in the 1980s and 1990s
- 13 Collision course: Argentine debt rescheduling in the 1980s and 1990s
- 14 The search for independence: Brazilian debt rescheduling in the 1980s and 1990s
- Part VI Implications
- Appendix
- Bibliography
- Index
11 - The good guys get tired: Mexican debt rescheduling in the 1980s and 1990s
Published online by Cambridge University Press: 02 December 2009
- Frontmatter
- Contents
- Preface
- Overview
- Part I Argument
- Part II Epoch I: 1820s–1860s
- Part III Epoch 2: 1860s–1910s
- Part IV Epoch 3: 1910s–1950s
- Part V Epoch 4: 1970s–1990s
- 11 The good guys get tired: Mexican debt rescheduling in the 1980s and 1990s
- 12 The politics of confrontation: Peruvian debt rescheduling in the 1980s and 1990s
- 13 Collision course: Argentine debt rescheduling in the 1980s and 1990s
- 14 The search for independence: Brazilian debt rescheduling in the 1980s and 1990s
- Part VI Implications
- Appendix
- Bibliography
- Index
Summary
Since the 1970s, two key factors have shaped Mexico's economic performance and bargaining capabilities. First, the internal political stability of the country at the beginning of the debt crisis allowed the government to have a longer-term outlook. Second, a special rapport with the U.S. government gave Mexico a powerful ally. In addition, the discovery of large oil reserves in the 1970s permitted Mexico to maintain steady growth in this decade. These factors distinguished Mexico's position from those of other Latin American debtors in the rescheduling negotiations in the 1980s and 1990s.
Mexican debt rescheduling is particularly important because of its precedentsetting arrangements. In the wake of the 1982 payments crisis, Mexico's agreement with the IMF required bankers and creditor governments to co-lend to Mexico – a phenomenon that came to be known as “involuntary lending.” In return, Mexico agreed to adopt an IMF austerity program. Signs of rapid economic growth in 1984 prompted IMF claims of success. By 1985, however, declining oil prices and increasing imports produced new financial difficulties and the need for a new and innovative agreement on Mexico's foreign debt.
After 1985, bargaining between Mexico and its lenders became harsher; agreements were increasingly difficult to reach. In September 1985, two earthquakes devastated Mexico City and oil prices dropped dramatically. After these events, Mexico desperately needed a new inflow of capital but lacked the political stability to undertake stringent economic adjustments.
- Type
- Chapter
- Information
- Debt GamesStrategic Interaction in International Debt Rescheduling, pp. 333 - 375Publisher: Cambridge University PressPrint publication year: 1996