Mexico sends out cry for help

Mexico is calling on "friendly" countries and banks to provide between $10bn and $15bn (£6.5bn-£10bn) to support its markets through its latest financial crisis.

President Ernesto Zedillo was last night expected to announce the package as part of an austerity drive to rein in the country's $28bn current account deficit.

Due to address the nation at 2 AM London time, Mr Zedillo is calling for "additional sacrifices" and structural changes to make Mexican industry more competitive.

Since 21 December, when the Mexican currency was floated, the peso has fallen 40 per cent, sending shock waves through the newly formed North American Free Trade Agreement trading block.

Since the creation of the North American tariff-free zone, imports into Mexico have flooded in at the rate of $1bn a week, a big increase on the previous year. Exports from Mexico to the north have also increased but not fast enough. Trade with the United States has risen 21 per cent while that with Canada grew 29 per cent.

Nafta has been blamed for exacerbating Mexico's woes but its defenders point out that rising exports are evidence that the zone is working.

Analysts also noted that a $7bn intervention last week by Washington and Ottawa to stop the peso from collapsing suggested that the Nafta allies were pulling together.

Nafta received a baptism of fire in Mexico's crisis-torn year of 1994, but analysts say it may already be quietly bearing fruit.

The day the treaty was launched, 1 January 1994, a peasant rebellion exploded in the southern state of Chiapas and rebels declared the deal with the US and Canada "a death sentence for the indigenous people of Mexico."

It was an inauspicious start to an accord that had been touted as a "win-win-win" situation for all three countries. Mexico's political and economic situation became steadily worse as the year wore on.

When the peso was devalued last week in a bid to curb a cripplingly high import bill, opponents inevitably blamed the trade treaty, which slashed tariffs and non-tariff barriers and made US and Canadian goods much cheaper in Mexico.

Separately, America's newest trading block kicked off on Sunday, bringing one step closer the dream of a continental free trading zone stretching from Alaska to Tierra del Fuego. The Mercosur customs agreement brings together Argentina, Brazil, Uruguay and Paraguay in a market of 190 million people with a combined gross national product of $800bn.

News
Alan Bennett criticised the lack of fairness in British society encapsulated by the private school system
peopleBut he does like Stewart Lee
Sport
David Moyes and Louis van Gaal
football
Arts and Entertainment
Sheridan Smith as Cilla Black and Ed Stoppard as her manager Brian Epstein
tvCilla Episode 2 review: Grit under the glamour in part two of biopic series starring Sheridan Smith
News
i100
PROMOTED VIDEO
Life and Style
Vote with your wallet: the app can help shoppers feel more informed about items on sale
lifeNew app reveals political leanings of food companies
Arts and Entertainment
The cover of Dark Side of the Moon
musicCan 'The Endless River' carry on the tradition? See for yourself
Sport
New Zealand fly-half Aaron Cruden pictured in The Zookeeper's Son on a late-night drinking session
rugby
Arts and Entertainment
Worldwide ticket sales for The Lion King musical surpassed $6.2bn ($3.8bn) this summer
tvMusical is biggest grossing show or film in history
Voices
A new app has been launched that enables people to have a cuddle from a stranger
voicesMaybe the new app will make it more normal to reach out to strangers
Arts and Entertainment
Salmond told a Scottish television chat show in 2001that he would also sit in front of a mirror and say things like,
tvCelebrity Trekkies from Alex Salmond to Barack Obama
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
food + drink
News
Rob Merrick's Lobby Journalists were playing Ed Balls' Labour Party MPs. The match is an annual event which takes place ahead of the opening of the party conference
newsRob Merrick insistes 'Ed will be hurting much more than me'
News
A cabin crew member photographed the devastation after one flight
news
Life and Style
Carol O'Brien, whose son Rob suffered many years of depression
healthOne mother's story of how London charity Maytree helped her son with his depression
Life and Style
People walk through Autumn leaves in St James's Park yesterday
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee / Experienced Recruitment Consultants

£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...

Trainee Recruitment Consultant - Soho

£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Quantitative Risk Manager

Up to £80000: Saxton Leigh: My client, a large commodities broker, is looking ...

Day In a Page

Secret politics of the weekly shop

The politics of the weekly shop

New app reveals political leanings of food companies
Beam me up, Scottie!

Beam me up, Scottie!

Celebrity Trekkies from Alex Salmond to Barack Obama
Beware Wet Paint: The ICA's latest ambitious exhibition

Beware Wet Paint

The ICA's latest ambitious exhibition
Pink Floyd have produced some of rock's greatest ever album covers

Pink Floyd have produced some of rock's greatest ever album covers

Can 'The Endless River' carry on the tradition?
Sanctuary for the suicidal

Sanctuary for the suicidal

One mother's story of how London charity Maytree helped her son with his depression
A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world
Apple still coolest brand – despite U2 PR disaster

Apple still the coolest brand

Despite PR disaster of free U2 album
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits