During 2009 the Mexican economy suffered its worst contraction since the 1930s, due to declining international financial markets and the sharp drop in exports. This caused a sharp drop in fiscal income, both from taxes and from petroleum activity.
To counter these effects Mexico undertook several measures of fiscal stimulus: modernization of its tax system, implement policies to protect public finances from oil price fluctuations and improve fiscal management in all governmental departments.
In order to accomplish their fiscal stimulus the government obtained a $1 billion dollar loan from the Inter-American Bank (IDB). IDB is a bank owned by member countries that helps finance development in Latin America and Mexico. The IDB loan was approved so as to support the consolidation of Mexico’s long-term fiscal sustainability as well as its economic recovery.