Mexico announced Thursday that it had recovered enough from its crippling economic crisis to repay, a few weeks ahead of schedule, $700 million of the $12.5 billion it borrowed from the United States this year, a gesture that represents as much a political payback as an economic one.
The offer comes just days before President Ernesto Zedillo of Mexico is scheduled to fly to Washington and New York for a series of meetings, including one with President Clinton next Tuesday. Zedillo will use the trip to argue that the American-led rescue was a success even though Mexico remains mired in a punishing recession that is severely restricting the sale of American goods here.
The early repayment of a portion of the $12.5 billion that Mexico has borrowed from the United States so far, and the payment of more than $400 million so far in interest on the loans without missing an installment, also provides Clinton with ammunition to silence critics who had warned that Washington would never recover the money.
In an impressive show of spin control, officials on both sides of the border portrayed the early repayment as proof that Clinton had been right when he stood by Mexico after Zedillo, in office for just weeks, was forced to devalue the peso abruptly, setting off Mexico’s worst financial crisis in a decade.
In February Clinton served as the broker for $50 billion in international economic first aid for Mexico, including $20 billion in loans from the United States. He did so after the U.S. Congress refused to go along with a plan to give Mexico $40 billion in loan guarantees.
“Thursday’s decision sends a positive signal to the financial markets that the tough financial measures Mexico has taken are succeeding and the American taxpayer is being paid ahead of schedule,” Clinton said.