MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Uncharted Mexico: Building bridges with the private sector

Private investment in construction has not done well under Morena governments, in power since 2018.

Source: INEGI

The big spike in the graph comes from substantial end of term investment by Andrés Manuel López Obrador in the lead up to the 2024 elections. Once public investment was gone, construction collapsed once again.

This year has seen marginally better news with a noticeable rebound that has stopped the investment hemorrhage. The only issue is it has been driven by public spending once again but by a government that has made it clear that it wants the private sector to pick up the slack.

This is where a recently announced “infrastructure bill” sent to Congress comes into play. It aims to make the big infrastructure stimulus plan announced by the government last month a reality.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Diminished returns—Another year, another increase in the Mexican State’s tax receipts, but something’s changed. Although the first two months of the year showed record collection, the increase was only 2.6% greater than the first two months of 2025 (which had seen an increase of 10.1% from 2024). This is markedly less than any year since the pandemic.
  
  The numbers are still better than what the government estimated it would collect given the strong economic headwinds Mexico is facing. These include a 1.1% fall in manufacturing output and a 3.5% fall in consumer spending last month—the latter being the worst February fall since 2018.
  

• Surfing the high seas of online piracy—The sale of counterfeit goods has

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Second choice—After president Claudia Sheinbaum’s electoral reform was rejected by congressional allies (and a few members of her own party), a Plan B reform has been announced. This one will be less ambitious but will still require legislators at every level of the government (local congresses must approve congressional reforms) to reduce their own salaries and perks.
  
  The reductions in party budgets and their leaderships’ power over candidates will not be touched. Mexico’s party-ocracy remains intact.

• Conservative and liberal—Tomorrow marks the first official round table for the Joint Review of the US-Mexico-Canada Agreement (USMCA). Mexico’s negotiating position will be simple, according to its Economy minister Marcelo Ebrard:

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Iran plan—Despite war in the Middle East driving up the price of oil close to $120 dollars at time of writing, the Mexican government says it has plans to limit price spikes at the pump.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Uncharted Mexico: Crime pays (poorly)

“There are no cars. No girls. Just fear for $3000 pesos.” The young man on screen speaks like an influencer, but is clothed in makeshift military attire, stained with blood, and soaked in sweat. His message: Don’t make my mistake and join a cartel. It’s a message tailored for the Mexican government in the days after the killing of Mexico’s top cartel boss, El Mencho. It was almost too perfect—and indeed, it was found that the video had been AI generated, but not before being seen by millions.

But something far more banal helped drive this exact point home. Along with weapons, authorities seized something that gave them far more insight into the life of a cartel: The spreadsheets detailing incomes and salaries for different ranks across the Cartel Jalisco Nueva Generación (CJNG).

From the beginning of her administration, Claudia Sheinbaum promised to “attack the root causes” of cartel recruitment. At its heart sits Jóvenes Construyendo Futuro, a programme that gives young people access to government-funded paid internships. It has long been criticised for being inefficient and wasteful by the private sector. Yet, the government has insisted that it exists in large part to keep unemployed youngsters, ripe for cartel recruitment, off the streets.

Over 3.3 million people have received the internship grant.

Perhaps Jóvenes Construyendo Futuro won’t be enough to keep everyone away from cartels… But the idea that, even if all goes well, you’ll still end up doing spreadsheets like El Mencho, no doubt will put many a would-be narco off.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Reshuffle and resupply—Despite Mexican exports to the US reaching record highs, Mexico’s trade surplus with its northern neighbour is falling. It is a symptom of the reconfiguration of Mexico’s supply chains away from the rest of the world and towards the US.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Chinese backdoor?—Nissan blamed “changing consumer preferences” when it announced the closure of its central Mexican plant of Aguascalientes last year. But the context in which the announcement was made couldn’t be ignored, as Donald Trump set the North American auto-industry alight with tariffs. Now, two finalists have emerged from the bidding process to acquire the Nissan factory: BYD and Geely. Both Chinese auto companies have been hit by 50% tariffs imposed by Mexico earlier this year and are hoping to avoid paying them by setting up shop on Mexican soil.
  
  Most attention has been placed on whether or not the US will be upset about this development. The Mexican auto industry itself should be worried,

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Maybe mining more Mexican minerals?—Mexico and the US have come to an agreement, after the Trump administration convened a “Critical Minerals Ministerial” to come up with a strategy to provide strategic supply chains with raw materials secured from reliable sources.
  Though couched in hemispheric and geo-political language, Mexico is also keen to get involved despite not wanting to broach the fact that the plan is aimed

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Uncharted Mexico: Another month, another record

Fears surrounding tariffs, the US-Mexico-Canada Agreement (USMCA), and stalling investment have overshadowed the fact that Mexico continues to grow as an exporter to the US.

In 2024, Canada was the greatest exporter to the US; Mexico held second place at 16.2% of total US imports. By November 2025, Mexico had become the world’s top exporter to the US, taking 17% of the its import market share.

All this follows increasingly positive noises coming from US and Mexican officials regarding ongoing trade negotiations. These seem to have involved throwing Cuba under the bus to avoid incurring the trade retaliations threatened by the Trump administration (yet Sheinbaum has insisted she will continue to send “humanitarian aid” in the form of other goods).

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Fear of being left in the cold—As a massive winter storm hit the US, worries about supply pushed natural gas prices up across Mexico—over 75% at time of writing. Though experts think it won’t be the case, there are also worries about the possibility that Texas could shut off the flow of gas entirely, as it did briefly in 2021 during a similar weather event.
  Mexico’s dependence on US gas has doubled in the five years since. Over 60% of Mexico’s electricity is generated by natural gas-powered plants, importing about 70% of its gas, of which 90% comes from the Texan Permian Basin. The Mexican government is now investing in previously frowned upon practices—like fracking—to increase domestic gas production.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Airspace warning—On January 16th, the US Federal Aviation Authority published a warning to carriers flying over Mexico’s northern Pacific region. It cited potential military activities and the possibility of signals jamming. It is less likely that this is a reference to an impending strike and more about continuing and increased covert surveillance operations over Mexican skies by US forces (for more on this see below).

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Uncharted Mexico: A 10-year low

The government of president Claudia Sheinbaum has reported that murders in Mexico fell by 40% in 2025. The dramatic fall means that Mexico is no longer among the 20 most deadly countries on Earth.

Critics have questioned the government’s numbers. A previous report by The Mexico Political Economist explored this concern, concluding that despite some statistical issues these numbers still stood up to scrutiny. The answer does seem to be a more intelligence-based security strategy.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Energy insufficiency—As president Claudia Sheinbaum announced that Mexico is refining 80% of the oil it consumes domestically, imports of natural gas—almost all of it from the US—hit record highs.
  The aim for the government since the previous Morena party administration under Andrés Manuel López Obrador (2018-2024) has been to achieve energy

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

A very quick recap before you dive into your fifth portion of recalentado. Our deep dives will return next week:

Uncharted Mexico: Economic flatline hides a transformation

A graph has been going around comparing how the US economy has rebounded with strength since the pandemic while the Mexican economy has flatlined. The poor performance since 2018 corresponds to the years in which the Morena party has been in power.

No doubt investment has slowed with the arrival of the ruling left-wing coalition, along with other factors like the return of Donald Trump which have also slowed production down.

But the raw figures hide a more complex story. One of economic transformations which are seeing the boom of certain regions and industries as others collapse.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

The year is coming to an end, but news continues to trickle in (in fact, ‘tis the season in which companies and governments try to sneak though controversial decisions to avoid public attention). The Mexico Political Economist will continue to send you your Weekly Essentials over the coming holiday weeks without flooding you with too much content. Our deep dives will be back up and running early next year.

Thank you to all who subscribe. Each and every one of you has kept English-language and independent coverage of Mexico growing.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

Big reforms are coming to town. In a time honoured and ethically dubious practice, Mexico’s Congress is rushing through a series of laws as the country settles down into the holiday spirit—and turns away from politics. Pro-government legislators celebrated their “productive” reforming spree of over 55 approved bills starting on the 1st September and ending today.

Here are a few of the biggest changes passed in the past week:

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Minimum wage—Mexico’s minimum wage will increase by 13% in 2026. It will also grow by 5% along the US-Mexico border region where it is already higher. With this, the government of Claudia Sheinbaum continues with her predecessor’s initial push, which, from 2018 to 2024, doubled the minimum wage across the country. It has always been done through agreements and negotiations with labour and the business sector.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Mexican super-computer—Mexico is proposing to create the world’s sixth most powerful super-computer. It will contain 14,480 GPUs and will be ready in two years, said José Merino—Sheinbaum’s powerful “digital transformation” tsar—at which time Coatlicue (as the computer is called) will be able to provide an enormous amount of processing power (314 petaflops, in the computing jargon).
  The idea is beguiling. A publicly accessible super-computer would be of

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Uncharted Mexico: Real-shoring?

For years Mexico waited expectantly for the arrival of “nearshoring”—investments to replace manufacturing capacity in global supply chains relocating away from China. Now that the term has fallen out of fashion the shift seems to be beginning to materialise.

The shifting of supply chains has gone from talk to action. Companies, including carmakers like GM, are making expensive moves out of China as geo-political tensions and its trade war with the US heat up. At the same time, the fears around a new and overpowered left-wing government in Mexico and its relationship with Donald Trump have somewhat toned down. The result has been a significant increase in foreign direct investment (FDI) in Mexico.

The trend has switched from the previous state of FDI.

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MXPE Weekly Essentials. Only the most important news in Mexican politics, policy, and markets from the past week.

Last week’s highlights:

• Honey, I shrunk the kids—In a previous “Don’t get distracted by…” section, The Mexico Political Economist covered the announcement of the so-called Gen Z march against president Claudia Sheinbaum’s government. Despite claims to be representing Mexico’s youth, the Gen Z groups cited as organisers of the protests came out to say they were not involved. The largest and most influential group behind the demonstration was repurposed from a previous X account for the protest having previously only posted messages in support of Venezuela’s opposition. The movement has no public-facing organisers. Doubts over who was really behind the march became so prominent that even Grecia Quiroz, the widow and successor mayor Carlos Manzo—whose murder was purportedly the reason the demonstration was called—came out to say that she was not taking part.
  The protest happened on Saturday, and while there was a substantial turnout (in the tens of thousands across the country), most of the attendees were over 50. It begs the question, why call a protest “Gen Z” when it clearly wasn’t organised by them? The answer is branding.

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