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Mexico's external public debt, economic and financial causes of debt and debt adjustment plans (English)

Basically, Mexico's economic position at the beginning of World War II was still essentially semi-colonial in nature. Subsistence agriculture was still the predominant economic activity. The commercial sector of the economy was geared primarily to exports of raw materials, a substantial portion of which was one of the large items in the balance of payments. According to the official balance of payments of International Monetary Fund payments of investment income in 1938 amounted to $41 million, or 21 percent of all current account payments. During that year, according to a different source, seventy one percent of all exports from Mexico originated from foreign-controlled enterprises. After adjustment, the Federal external debt of Mexico amounts to about $345 million, and calls for service payments totaling $36 million in 1949. After rising to $39,400,000 in 1950, payments remain around $30 million until 1955 when they begin to decline rapidly. A large item of the debt payments is that arising out of the settlement for the expropriation of the Anglo Dutch Oil properties in 1938. That settlement called for the payment of $81,250,000 plus 3 percent interest from the date of expropriation (March 18, 1938) to September 18t 1948 (amounting to $25.500, 000) and 3 percent thereafter on the outstanding balance until the last installment is paid in 1962, the total amounting to $130 million. The payments are made in annual installments of $8,700,000. A balance of $19 million under the Mexican-American Claims Settlement was also outstanding at the beginning of 1948. The debt to the United States Government is largely of recent origin - the loans from the Export-Import Bank and the Lend-Lease debt. While the amount of the latter is secret, it would be substantially less than the total of aid rendered which was $39,273,000. On June 30t 1948 the outstanding indebtedness to the Export-Import Bank was $68,854,000. The undisbursed balances of loans authorized were $53,716,000.

Details

  • Author

    Lynch, James J.

  • Document Date

    1949/01/30

  • Document Type

    Pre-2003 Economic or Sector Report

  • Report Number

    66854

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    Mexico,

  • Region

    Latin America & Caribbean,

  • Disclosure Date

    2013/01/10

  • Disclosure Status

    Disclosed

  • Doc Name

    Mexico's external public debt, economic and financial causes of debt and debt adjustment plans

  • Keywords

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Citation

Lynch, James J.

Mexico's external public debt, economic and financial causes of debt and debt adjustment plans (English). Economic department report ; no. E11 Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/526771468050721941/Mexicos-external-public-debt-economic-and-financial-causes-of-debt-and-debt-adjustment-plans