Managing Economic Crises; Bill Clinton and the Mexican Peso Crisis

Author Information

Liza-Anne Cabral

Abstract/Description

The year 1994 was one of the most tumultuous in the modern history of Mexico. During that year, two major political figures were assassinated, an uprising against the federal government began in the state of Chiapas, and the government attempted to finance its deficit payments with various debt instruments. The political instability caused by the assassinations and the Zapatista uprising, along with continued economic uncertainty within Mexico, caused foreign investment capital to flee Mexico. Because of this capital flight, Mexican President Ernesto Zedillo, decided in December of 1994 to devalue the Mexican currency. Instead of helping the situation, it actually caused more panic from foreign investors. More capital left Mexico and the government was in danger of defaulting on its debt payments. During this time period, President Bill Clinton kept a close eye on the situation with Mexico. Because of NAFTA and other economic agreements, the Mexican and American economies were intertwined more than ever. Mexico’s inability to pay their debts, the increasing political instability, and the downward spiral in the economy worried many in the United States that it would have an adverse affect on a still recovering American economy.

Note on the Author

Liza-Anne Cabral is a BSC graduate who majored in Communication Studies. This project was funded by the Adrian Tinsley Program and was researched under the mentorship of Dr. Jason Edwards. It was presented at the ATP 2009 Undergraduate Research Symposium, as well as the National Conference on Undergraduate Research (NCUR) in April 2010.

Recommended Citation

Cabral, Liza-Anne (2010). Managing Economic Crises; Bill Clinton and the Mexican Peso Crisis. Undergraduate Review, 6, 29-34.
Available at: https://vc.bridgew.edu/undergrad_rev/vol6/iss1/8

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Articles published in The Undergraduate Review are the property of the individual contributors and may not be reprinted, reformatted, repurposed or duplicated, without the contributor’s consent.