Management of oil windfalls in Mexico: historical experience and policy options for the future
Stephen Everhart, Robert Duval-Hernandez, World Bank. Mexico Country Management Unit, International Finance Corporation. Economics Dept
World Bank, Mexico Country Management Unit and International Finance Corp., Economics Dept., 2001 - Business & Economics - 32 pages
Policy options for protecting Mexico's economy from volatility in oil revenues without eliminating the benefits from rising prices include a stablilizaton fund and hedging strategies on international markets. A stabilization fund and hedging strategies can complement each other, the fund working as the main receipient of revenues, and the hedging strategies managing short-lived movements in prices. This joint strategy would reduce the size of the fund and the probablility of its going bankrupt.
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average balance of payments barrel base period Booming Sector commodity exports commodity windfalls Consumption Consumption Consumption counterfactual scenario Cuddington current account deficit Developing Countries Development Economics Domestic Expenditure Resource Dutch Disease estimates exchange rate Expenditure Resource Total external borrowing external debt External Shocks financed fiscal Gavin GDP Gross Domestic Gelb Government Revenues Gross Domestic Expenditure growth hedging strategies income increase Indonesia INEGI inflation interest rate Lazaro Cardenas long-run macroeconomic Management of Oil Mexican economy Mexican government Mexican peso Mining Consumption Consumption movements in prices Nigeria oil export revenues oil industry oil production oil rents oil revenues oil shock Oil Windfalls overvalued PEMEX percent of GDP Policy Responses Private Investment Balance private sector public investment Public Private Investment public sector resource balance Resource Total Mining rise Shocks and Stabilization stabilization fund Stabilization Mechanisms Structural Adjustment Tornell and Lane TOT/GDP TOT/X Venezuela windfall gains Windfalls in Mexico World Bank