The response of the international financial community to the Mexican problems early this year was confused and ad

The response of the international financial community to the Mexican problems early this year was confused and ad hoc, the authors argue.It also relied on the happy chance that the IMF had plenty of funds in its coffers at the time. It suggests a new agency to supervise negotiations with creditors and transmit information.Thirdly, it suggests improved procedures for reacting to a crisis. But all would be better off if the stampede leading to the collapse could be prevented.The authors, Barry Eichengreen and Richard Portes of the Centre for Economic Policy Research, propose allowing the International Monetary Fund to impose a payments standstill.They also suggest countries offer new types of bond contracts, backed by the IMF, which would prevent a few investors refusing a debt restructuring desired by the majority.A second problem addressed by the report is that debt restructuring can be a painfully long process. A new report financed by the Treasury and Bank of England on how to deal with international financial crises, published today, is likely to win backing from finance ministers meeting in Washington this weekend. Drawing on the lessons of the Mexican crisis at the beginning of this year, it suggests reforms of the process for restructuring a country's debts. The report concludes that one of the key improvements would be to stop the "rush for the exit" - the flight of capital when a country first runs into trouble.Every investor has an incentive to be one of the first to bail out before the country's financial markets collapse too far. The organisation, which issued its press release last month, yesterday declined to comment.Since coming to the stock market in 1991 with 80 service stations, Frost has grown rapidly, and in July paid pounds 83m for Burmah Castrol's petrol retail operation.. The writ does not put a figure on the claim for damages.Frost's new lead-free petrol includes an additive that makes it suitable for cars using leaded four-star fuel.

Frost said the petrol gives the same performance as leaded four-star.The RMI had reported Frost to the trading standards department, urging prosecution if the petrol was not suitable. "The RMI issued a press release making these claims, which was followed up by the media throughout the country It is not yet possible to assess the damage," Mr Frost said. RUSSELL HOTTEN Frost Group, the quoted petrol retailer, yesterday issued a writ for damages against the Retail Motor Industry Federation in a row over claims that its fuel can damage car engines. The federation had said that a new petrol, to be sold through many of Frost's 1,250 Save outlets, may be bad for engines, a claim supported by Rover Group and Shell.James Frost, chairman of Frost Group, the fifth largest petrol retailer in the UK, said the RMI had failed to provide satisfactory evidence to back its claim. The country had met the IMF's economic conditions and would qualify for another $1.6bn disbursement in mid-November, on top of the $12bn it has already received from the Fund.. "One of the best ways for countries to protect themselves against erratic behaviour by the financial markets is to provide all the relevant data. Markets hate surprises," he said.The Mexican crisis, which triggered the flurry of activity to improve the IMF's surveillance procedures and financial resources, is well on its way to resolution, Mr Camdessus said.

Ministers are unlikely to agree to a general increase in the subscriptions paid by member countries.As another part of its post-Mexico improvements, the Fund expects to have stricter standards for economic statistics provided by members in place by next April: 12 basic measures that all countries must provide monthly, and a more demanding standard for countries that borrow in the international financial markets.Mr Camdessus said the Fund was working on making the information available electronically to the financial markets. We need to have a mechanism permanently in place."The IMF has failed, though, in another bid to increase its resources. Although the non-G7 members of the G10 fear dilution of their influence, their bigger partners believe it is essential to make other important economies take up their responsibilities to the international community.Terms of the new parallel arrangement are still under discussion but Mr Camdessus said yesterday: "I hope they come to a decision as rapidly as possible. Austria, Australia and Korea, for example, are being approached for contributions to a new, parallel arrangement to the existing GAB.

The decision was a reaction to the Mexican financial crisis, even though the Fund financed its $17.8-bn loan to Mexico out of its own resources.However, progress on extending the GAB has been slowed by negotiations to involve other countries. These are a $27-bn overdraft facility provided by the G7 and the four other countries - Belgium, the Netherlands, Sweden and Switzerland - which make up the G10. The new arrangement should be in place by next spring. Michel Camdessus, the IMF's managing director, said yesterday: "This is a very important and timely initiative."The Group of Seven (G7) industrial countries agreed at their summit in Halifax in June to a significant extension to the IMF's General Arrangements to Borrow. The International Monetary Fund expects its members to agree this weekend to a doubling of its emergency funds, one of the most important steps towards improving its ability to react to financial crises Finance ministers gathering in Washington on the eve of the IMF's annual meeting will approve proposals to provide a $50bn-plus fighting fund to tackle emergencies like the Mexican financial crisis. If you really can't wait, you can check your electronic mail in Washington while you jet from London to Lisbon.Eventually it is hoped to provide real-time share prices in the air and news headlines in a babel of languages.This is the future and it looks pretty stressful.Investment Column, page 27. That means aircraft have to keep close to pre-determined routes and a long, long way from each other.Satellite communications, and the pinpoint tracking they provide even miles out of a country's airspace, should mean that aircraft can fly much closer together, can avoid costly stacking above congested airports and steer clear of turbulence.One estimate puts the potential savings at $250,000 per plane a year.Apart from the fact that airlines will have to adopt the system because only wired up planes will get the best routes, the savings should mean that these systems become standard.The system's developers - it has been put together by a consortium of Racal, Honeywell, Sita, Claircom and Immarsat, the satellite operator - not surprisingly talk with starry-eyed enthusiasm about the potential for satellite communications in the air.Teleconferencing between travelling executives and their offices will become routine, they believe.