G-10 Takes Get-Tough Stance Toward Crises
WASHINGTON — Rich industrial countries on Monday warned debtor nations and global investors not to expect a free ride in the event of another economic crisis similar to the one that struck Mexico last year.
Responding to criticism that last year’s $50-billion rescue package for Mexico amounted to a bailout of the country and wealthy Wall Street investors, the Group of 10 leading industrialized nations--essentially a group interested in economics and trade issues--made clear that there would be no place to hide during the next crisis.
“Neither debtor countries nor their private creditors should expect to be insulated from any adverse financial consequences . . . in the event of a crisis,†the Group of 10 said in a statement after its deliberations on the fringes of the semiannual International Monetary Fund and World Bank meetings.
Venezuela, seen as a possible flash point, cooled considerably Monday when the IMF announced that it had reached an agreement on an economic package for the troubled country--a $1.4-billion, 12-month standby loan.
The G-10 also called for investors to accept changes in future bond contract terms to make it easier for cash-strapped debtor nations to work out their liquidity problems.
Sign up for Essential California
The most important California stories and recommendations in your inbox every morning.
You may occasionally receive promotional content from the Los Angeles Times.
