Mexico COVID-19 Reaction

The reaction of governments to the Coronavirus have been wide and varied and for any companies involved in international business keeping track of the numerous fiscal economic incentives is a full-time job.

Early in the pandemic the Mexican government took action providing payment holidays for loans for between four and six months, depending on clients and their businesses. This was then followed by a $60 billion swap mechanism with the US Federal reserve to support liquidity in the market. The money will be used to carry out credit auctions in dollars with Mexican credit institutions.

More recently the government set aside $31 billion in liquidity and credits to support the economy. And to further stimulate business a $27.6 billion package has been provided specifically for job creation.

It is interesting to contrast Mexico’s actions with those taken by other South American countries. El Salvador successfully received a grant of $389 million from the IMF which will be used for emergency financial assistance while Honduras set aside $144 million in emergency funding. But the country with the largest stimulus package is Peru which boasts a variety of labour, fiscal and tax measures.

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