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Mexico watching peers for IMF funding pledge: Meade
May 30, 2012 / 10:48 PM / 6 years ago

Mexico watching peers for IMF funding pledge: Meade

MEXICO CITY (Reuters) - Mexico is waiting on other countries before finalizing how much it will lend to the International Monetary Fund, Mexican Finance Minister Jose Antonio Meade said on Wednesday.

Mexico's Finance Minister Jose Antonio Meade waves after an interview for the Reuters Latin America Investment Summit in Mexico City May 30, 2012. REUTERS/Edgard Garrido

Group of 20 leading world economies have pledged $430 billion in extra resources for the international lender, but Mexico - along with emerging market powers China, Brazil, India and Russia - has yet to commit to a specific number.

“We have said that once the consensus amount is defined we will contribute our fair share,” Meade said in an interview for the Reuters Latin America Investment Summit.

Mexico, which holds the rotating G20 chair, will host a summit of G20 leaders on June 18-19 where final commitments are expected to be made.

Officials say the contribution will be based on Mexico’s IMF quota share, set to rise to 1.87 percent.

Using the $430 billion in pledges as a yardstick, that would put Mexico’s share at $8 billion, but it could increase to $10 billion or so.

The extra IMF firepower aims to contain fallout from the euro zone debt crisis, set to dominate G20 talks in the beach resort of Los Cabos. They are scheduled one day after a Greek vote which may decide whether the country stays in the euro.

No party was able to form a government after a May election ended in deadlock between groups that support and oppose austerity conditions attached to a rescue package.

Polls show public opinion is still divided ahead of the June 17 vote, and investors and politicians are concerned about the prospect of a win by the radical SYRIZA party, which has said it wants to remain in the euro but ditch austerity steps.

The G20 meeting is also likely to feature debate about the right balance between fiscal austerity and policies to support growth given growing concern about whether the euro zone has done enough to prevent a painful breakup of the monetary union.

“The G20 has to find a good balance,” Meade said. “It’s therefore important to talk about the opportunities for coordination that exist between G20 countries.”

But he and central bank governor Agustin Carstens played down the prospect of a row between austerity-advocate Germany and countries who have urged the euro zone to either support Greece fully or let the euro fail, such as Canada and Britain.

“It’s not a forum to discuss individual countries and regions, it’s rather a forum to discuss how to catalyze coordinated action to lead to a better situation for the global economy,” Carstens told Reuters earlier this week.

In some cases, it was unrealistic to focus too much on growth, he said.

“In the Los Cabos meeting all the governments will try to aim for faster growth but realism will prevail in that in some countries fiscal adjustments have to take priority ... They just can’t finance a bigger fiscal deficit.”

Follow Reuters Summits on Twitter @Reuters_Summits

Additional reporting by Ana Isabel Martinez, Michael O'Boyle and Luis Rojas; Editing by Phil Berlowitz

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