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Mexico’s President Rules Out Company Bailouts or Requesting IMF Line

President Andres Manuel Lopez Obrador said the nation’s companies shouldn’t expect bailouts or tax amnesties and that Mexico won’t tap a standing credit line with the International Monetary Fund even as other economies take extraordinary measures to fight a slump in activity.

“No more bailouts in the style of the neoliberal period, which were given to banks, to large companies. No, don’t even think that there will be tax forgiveness or other mechanisms that were used before,” Lopez Obrador said Monday in his morning news conference.

Economists are quickly slashing their outlooks for Mexico and now expect Latin America’s second-largest economy to contract 3% this year due to the impact of coronavirus on the local economy and a likely recession in the U.S., Mexico’s top trading partner.

Mexican government health officials say the country is not yet seeing widespread community transmission and authorities have so far avoided some of the most drastic measures taken by other nations on fear of halting economic activity.

MEXICO INSIGHT: Already Weak Economy Vulnerable to Virus Shock

“Don’t stop going out, we are still in phase one. I will say when not to go out,” Lopez Obador said in a video filmed at a traditional Mexican restaurant in the state of Oaxaca and posted on his Facebook page this weekend. “Keep taking the family out to eat,” he said.

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