MEXICO CITY - PAWN shops in Mexico City have seen a spike in business since the A(H1N1) flu broke out last month, as residents try to fight hard economic times by hocking their valuables.

Most staff and some customers covered their faces with surgical masks, while paper signs taped on stone walls informed clients of longer opening hours introduced since at the end of last month.

The maximum time limit to reclaim possessions pawned at Monte de Piedad - a nationwide network of pawnbrokers founded in 1775 - is 17 months.

Already hard hit by the crisis which began in its closely tied northern neighbor, the flu has dealt Mexico a further blow, with tourism and small businesses particularly suffering from a shutdown of activities to try to contain the virus.

Experts predict the economy will this year put in its worst performance since 1995, when an economic crisis and devaluation of the peso caused GDP to sink 6.9 per cent under what became known as the 'Tequila Effect'.

This year's GDP was already expected to shrink by around five per cent even before the flu struck. The finance ministry has estimated the flu's impact will cost the economy around US$2.3 billion (S$3.34 billion) - around 0.3 per cent of GDP.

Monte de Piedad registers some 140,000 operations per day across its nationwide network, and staff are expecting that to increase along with growing job insecurity.

Clients can pawn anything from a ring to a house, with the average loan at 192 dollars, and the minimum only three dollars.

The interest rate is four percent, and clients - including many workers with no steady wage - have no choice but to accept.

Further down the line, Araceli Lopez, a 22-year-old student, came to pawn some family jewelry after her parents lost all clients from their Internet cafe two weeks ago. -- AFP