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IMF offers Mexico $7.8bn loan

Rupert Cornwell
Friday 27 January 1995 00:02 GMT
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The International Monetary fund yesterday announced that it would make the largest loan in its history to financially battered Mexico - at the very moment that the Clinton administration's own $40bn loan guarantee package is running into ever mor e powerful opposition on Capitol Hill.

The facility, worth up to $7.8bn over an 18-month period, was agreed by Michel Camdessus, the IMF's managing director, and other senior officials. It still requires formal approval by the IMF board next week, but this is considered a certainty after Mr Camdessus' ringing endorsement last night of the "strong, credible and coherent programme" brought forward by the government of President Ernesto Zedillo earlier this month.

The fund's decision was instantly hailed by senior US officials as a sign of the international community's deter- mination to help Mexico out of its present crisis. But Robert Rubin, the Treasury Secretary, warned that the loan guarantees remained "an urgent priority" if Mexico's economic problems were to be contained.

President Clinton too stepped up his support for the move, insisting that Mexico had never

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