MEXICO’S FINANCES

Evening Star, Issue 23000, 4 July 1938, Page 9

MEXICO’S FINANCES

EFFORT TO STEM ECONOMIC COLLAPSE DOUBLE EXGHAHGE RATE PLANNED Press Association— By Telegraph—Copyright NEW YORK, July 2. The Mexico City correspondent of the ‘ New York Times ’ says that the Government announced plan? to impose a 12 per cent, tax on all exports, including raw materials, simultaneously establishing a quasi-permanent limitation of imports, which come largely from the United States, by establishing a double exchange rate. The tentative plans include pegging the peso at five to a dollar for exports and four to a dollar for imports, thus apparently establishing central hank control.

The objects of the plans are said to be first to make ud the Budget deficit resulting from the loss of petroleum taxes, plus economic collapse, and, secondly, to subsidise exports and maintain imports qt the minimum.

The peso, which has fallen gradually since the expropriation of foreign oil holdings, when it was fixed at 3.60 to the dollar, has reached 4.75 to the dollar.