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Mexico woos British funds with pledges of reform

Phil Davison
Sunday 28 January 1996 19:02 EST
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The President of Mexico will try to persuade John Major today that his country has at last achieved political and financial stability. President Ernesto Zedillo hopes to win further British investment and a free-trade agreement with the European Union.

Mr Zedillo, who arrived in London yesterday after three days in Spain, is accompanied on his first official visit to Europe by key cabinet members and Mexico's most prominent businessmen, including several dollar billionaires. He hopes to assure European leaders and investors that multi-party democracy is blossoming after almost seven decades of virtual one-party rule by his Institutional Revolutionary Party (PRI), despite the fact that 1995 was Mexico City's worst year of crime and violence since the 1910-17 revolution.

The PRI is showing signs of self-destruction, with reformers and technocrats such as Mr Zedillo struggling against the influence of hardline "dinosaurs".

To Eddie George, the Bank of England Governor, and British businessmen, Mr Zedillo will insist Mexico is pulling out of one of its worst recession this century after the crisis that followed the devaluation and subsequent collapse of the peso weeks after he took office in December 1994. Mexico came close to bankruptcy and debt default early last year before being bailed out by President Bill Clinton, with the backing of the International Monetary Fund.

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