- Claudia Sheinbaum was elected as Mexico’s first female president in June 2024
- U.S. President Trump threatens tariffs on all Mexican imports as a result of drug trafficking and migration across the shared border.
- Nearshoring in Mexico, the potential future driver for economic growth in Mexico, is at risk following the U.S. election.

Why is Sheinbaum’s heat level HOT?
Answer: Newly elected president of Mexico, Sheinbaum needs to balance an incoming U.S. administration while tackling climate change.
In June of 2024, Claudia Sheinbaum, a former climate scientist and mayor of Mexico City, was elected Mexico’s first female president. Sheinbaum currently stands with a majority in the Mexican Congress, following her landslide victory, making her generally unstoppable domestically. Reviving a Mexican political tradition, former Mexican president Andrés Manuel López Obrador (AMLO) selected Sheinbaum as his successor in the Morena party. In her new position, Sheinbaum seeks to tackle environmental, social, and economic issues and problems of organised crime and drug trafficking.
Sheinbaum has shared major plans to reshape the nation’s energy industry. She has promised new investments in the transmission and distribution of energy to increase efficiency and reduce greenhouse gases. Additionally, Sheinbaum has reformulated the country’s will to return to the international stage, despite AMLOs nationalistic style of nationalising energy sourcing.
The Biden administration heavily supported energy transition projects in Central and South America, which U.S. President Donald Trump now has the power to row back, signalling the reintroduction of oil and gas projects in the region. The threat of tariffs, linked to concerns over drug trafficking and migration across the shared border, would strain Mexico-U.S. trade relations.
However, the practicality of its implementation has been questionable, given the duty-free trade agreement between Mexico, the U.S. and Canada under the USMCA agreement, which Trump established himself during his first term. Nonetheless, this uncertainty surrounding the Mexican-American oil and trade industry is forcing Sheinbaum to navigate a more challenging geo-political landscape in achieving her goals towards a sustainable energy transition in Mexico, as well as in supporting a return of Mexico to the International stage. With this, Sheinbaum continues to show her resilient attitude, despite the challenges from the US.
What is changing Sheinbaum’s heat level?
Answer: Sheinbaum is facing Pemex debt and stalled plans for nearshoring, putting Mexico at risk in the international arena.
Nearshoring is the process by which businesses outsource operations to a nearby country over a distant one, typically decreasing costs. With the recent election in the U.S., nearshoring, which holds great potential for being a main driver in Mexico’s economic growth, will be further stalled as a result of the threats of tariffs. Under AMLO’s presidency, judicial reforms and changes to regulatory frameworks had sparked uncertainty among foreign investors, leading to a general decrease in investments nationwide. As Sheinbaum begins her six-year term, opportunities for promoting nearshoring are expanding. However, Trump’s victory could delay these plans due to the threatened tariffs.
Pemex, a Mexican state-owned petroleum company, is one of the world’s most indebted energy corporations. During AMLOs presidency, energy counter-reforms were attempted to refund the domestic monopoly on energy. However, without foreign investment, as heavily discouraged under the AMLO administration, the debt increased.
Today, the debt is valued at MXN 103.6 billion, or roughly USD 5.1 billion. The debt accounts for roughly 0.3% of the national GDP, yet the industry accounts for 1.3% of Mexico’s total GDP, with Mexico as the 11th largest oil producer in the world. This debt constrains Sheinbaum’s ability to pursue new economic initiatives in the field of energy. It also creates tension with her climate policy goals. Sheinbaum has implemented a cap on average crude oil production to balance these conflicting priorities.
What is driving Sheinbaum?
Answer: With the help of her professional background, Sheinbaum is aiming to distance herself from AMLOs governing style, creating a legacy of her own.
Drawing from her experience as Mexico City’s former mayor and her expertise as a climate scientist, Sheinbaum brings strong credentials and a vision for Mexico’s future.
With the threats of tariffs, linked to concerns over drug trafficking and migration across the shared border, Sheinbaum is also driven to reassure trade partners on the international scale, following AMLOs discouragement of Mexico in the international political field. Additionally, she aims to strengthen border security and reinforce bilateral cooperation with the U.S.
Additionally, as Sheinbaum’s electoral success stems from AMLO’s support and legacy, she now seeks to establish her distinct legacy through these policies, underscoring her resilience as Mexico’s new president. Sheinbaum aims at political independence, particularly through the creation of the Business Advisory Board, a mechanism allowing her to engage with Mexican business leaders and collaborate closer with the private sector to distance herself from AMLO’s more polarising strategies.
What does this mean for you?
Answer: U.S. threats of tariffs raise the question of the future of the global economy.
As the U.S. is increasingly utilising more protectionist policies, seen through threats of tariffs of 25% on Mexican imports, it is understood the pattern is starting to spread worldwide and, therefore, signalling a changing world economy. On an international scale, it is worth noting the retaliation in the looming trade war by Sheinbaum as a signal of the emergence of smaller powers and corporations from the Global South. These emerging powers are gaining momentum, leaving us with the question of whether this signals a broader shift in global economic power dynamics and the potential rise of new regional economic alliances the future may hold.
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