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Weekly Report October 9th, 2026

Hot Topics SHEINBAUM MEETS WITH RONALD JOHNSON AND BUSINESS LEADERS AT PALACIO NACIONAL President Claudia Sheinbaum met with U.S. Ambassador Ronald Johnson and more than 30 Mexican and U.S. business representatives at Palacio Nacional, in a meeting focused on trade, investment and the broader bilateral relationship. Participants included representatives from the American Chamber of Commerce, export-oriented companies and the steel industry, alongside Economy Secretary Marcelo Ebrard, CCE President José Medina Mora and Altagracia Gómez. Sheinbaum described the conversation as positive and highlighted the confidence of U.S. companies investing in Mexico. Business representatives focused heavily on the USMCA review. Medina Mora said the private sector’s main concern is securing a 16year extension of the agreement with six-year review periods, arguing that greater certainty would support additional investment. He also expressed interest in reducing Section 232 tariffs affecting Mexican steel, aluminum and vehicle exports. AmCham representatives said they see room for a partial bilateral understanding in the coming weeks and will maintain working tables with the Economy Ministry on USMCA, legal certainty and infrastructure. The meeting also covered border security, migration and bilateral cooperation against drug trafficking. Sheinbaum said additional investment announcements would be presented later, while Altagracia Gómez indicated that potential projects involve pharmaceuticals, medical supplies, energy and agriculture-related activities. Sheinbaum also confirmed that she and Ambassador Johnson agreed to hold a separate follow-up meeting to continue discussing bilateral issues. Source: El Heraldo, La Jornada

U.S.-MEXICO BORDER SECURITY OPERATION The United States and Mexico deployed hundreds of personnel along the Texas–Tamaulipas border after U.S. officials reported that Coast Guard members came under fire near Garceno, Texas, on September 26. The U.S. Coast Guard said the gunfire came from the Mexican side and that personnel returned fire; no injuries were reported and the source of the initial shots was not identified.

ELECTRICITY INVESTMENT ADVANCES AS MEXICO REMAINS DEPENDENT ON U.S. NATURAL GAS Mexico plans to invest around MXN 1.17 trillion through 2030 to expand and modernize electricity generation, transmission, distribution and natural gas infrastructure. Of the total, MXN 794 billion will go to electricity generation, MXN 161 billion to transmission, MXN 72 billion to distribution, and around MXN 141 billion to gas pipelines. The government expects the projects to add roughly 38,000 MW of capacity, with a combination of CFE, private and mixed investment. Six new combined-cycle plants added 3,203 MW between 2025 and 2026, while nine additional plants totaling more than 9,300 MW are planned by 2030.

The investment push comes as Mexico remains highly dependent on imported U.S. natural gas. CENAGAS Director Cuitláhuac García said U.S. gas flows temporarily fell by around 20% during a recent “critical situation” in the United States. Mexico managed the disruption without major problems, but García said the country currently maintains reserves equivalent to only about three days of consumption in an emergency. The government is therefore expanding both electricity infrastructure and the gas-pipeline network while continuing to rely heavily on natural gas, including for combined-cycle power generation. Source: El Financiero (2)

President Claudia Sheinbaum requested evidence of the alleged cross-border gunfire, saying Mexican armed forces had not detected shots originating from Mexican territory. Both governments later agreed to conduct coordinated “mirror operations” on their respective sides of the border. Mexico deployed 500 Army and National Guard personnel in Tamaulipas, supported by helicopters, drones and anti-drone equipment, while the circumstances surrounding the incident remain under investigation. Source: Washington Post

Hot Topics U.S.-MEXICO SECURITY COOPERATION SPARKS DISPUTE OVER QUERÉTARO POLICE ACADEMY A new police-training academy in Querétaro has become the center of a dispute between the federal government, the state government and the U.S. Embassy over the rules governing international security cooperation. The project, part of the Rhino security complex, is designed to train police in tactical inspection techniques to detect hidden compartments and intervene in crimes involving drugs, weapons, money, banking operations and other forms of smuggling. The academy is linked to cooperation with the U.S. Bureau of International Narcotics and Law Enforcement Affairs and is expected to be completed in January 2027. President Claudia Sheinbaum said the project does not yet have federal authorization and stressed that cooperation with foreign institutions must be approved through the Ministry of Foreign Affairs and the High-Level Security Group. The controversy began after Querétaro Governor Mauricio Kuri and U.S. Ambassador Ronald Johnson attended the laying of the first stone on October 2. The SRE later said it had been informed of Johnson’s visit, but not of the specific security-cooperation purpose of the event and offered to accompany the state government in completing the required procedures. Source: El Pais

SHEINBAUM REJECTS U.S. PRESSURE CLAIMS OVER MORENA CANDIDATES President Claudia Sheinbaum rejected claims that Morena had yielded to pressure from the United States in selecting its virtual candidates for the 2027 elections. The accusation came from PT leader Alberto Anaya, who argued that U.S. pressure had influenced the selection of more centrist candidates. Sheinbaum called the claim “absurd” and said it had no basis, stressing that Morena’s state coordinators were chosen through internal polling. The dispute also exposed tensions within the governing coalition ahead of the 2027 elections. Anaya said he did not see sufficient willingness from Morena and the PVEM to form a full coalition and maintained that the PT could compete independently. Separately, internal disagreements have surfaced within Morena over some of the designated coordinators, including in Nuevo León. Source: El Financiero

MEXICAN AUTO EXPORTS FALL AS U.S. TARIFFS WEIGH ON INDUSTRY Mexico’s auto exports fell 12% year-on-year in September, their sharpest decline since December 2025, while vehicle production dropped 15%. The figures marked the largest export contraction so far in 2026. Domestic sales moved in the opposite direction, increasing 8% during the month and partially offsetting weaker external demand. The decline comes as Mexican-made vehicles continue to face a 25% U.S. tariff, although Mexican officials estimate that compliance with USMCA rules of origin can reduce the effective burden to around 10%– 12%. General Motors, Ford and Nissan recorded significant export declines in September, while Kia, BMW and Mazda increased shipments. Despite the slowdown, Mexico remains the largest foreign supplier of light vehicles to the U.S., accounting for around 16% of the market. In the first nine months of 2026, Mexican auto exports to the U.S. declined 5%, while shipments to Canada increased just over 9%. Source: Reuters

Legislative and Regulation Issues: FOREIGN TRADE DRAFT DECREE AMENDING AND ADDING VARIOUS PROVISIONS OF THE CUSTOMS LAW Presented by: Federal Executive (President Claudia Sheinbaum). Finance and Public Credit Committee, Chamber of Deputies.

DIGITAL ECONOMY

LABOR

DRAFT DECREE ISSUING THE DIIGITAL ECONOMY LAW FOR DIGITAL AND ELECTRONIC PAYMENTS

DRAFT DECREE AMENDING AND ADDING VARIOUS PROVISIONS OF THE FEDERAL LABOR LAW REGARDING THE RIGHT TO DIGITAL DISCONNECTION

Presented by: Federal Executive (President Claudia Sheinbaum). Finance and Public Credit Committee, Chamber of Deputies.

Presented by: Senator Emmanuel Reyes Carmona (Morena).

Purpose: Promote the adoption and use of digital and electronic payment methods, reducing reliance on cash and expanding access to digital financial services. The law requires federal, state, and municipal authorities to enable electronic payments for public services and procedures. It also establishes obligations for businesses and service providers to implement the necessary payment infrastructure, including digital transfers and other electronic payment systems. The Ministry of Finance may determine sectors and activities where digital payments will be required, while digital identification mechanisms, including CURP Digital, may be used for financial services.

Purpose: Strengthen customs oversight and combat the undervaluation of imported goods by expanding verification mechanisms and adjusting precautionary embargo procedures. Customs authorities may initiate verification when declared values are lower than those of identical or similar goods. For discrepancies below 20 percent, importers may substitute a precautionary embargo with a cash deposit or customs guarantee. The reform also strengthens penalties for inaccurate or false documentation involving hydrocarbons and petroleum products, establishing fines ranging from 50 to 100 percent of the commercial value of the goods.

Status: 06-10-2026 - Approved in general and in particular by the Chamber of Deputies, Sent to the Senate for further legislative consideration.

Status: 06-10-2026 - Approved in general and in particular by the Chamber of Deputies. Sent to the Senate for further legislative consideration.

Purpose: Establish the right to digital disconnection for all workers, regardless of their work arrangement, allowing them to refrain from responding to work-related calls, messages, emails, or instructions outside working hours, during rest days, vacations, and leave. Employers would be prohibited from penalizing workers for exercising this right and required to establish internal digital disconnection policies, including rules for after-hours communication, emergencies, and on-call duties. Work performed outside regular hours at the employer's request would count as working time and be compensated accordingly. Exceptions would apply to emergencies, extraordinary circumstances, and previously established on-call arrangements. Violations could result in fines ranging from 50 to 500 UMA. Status: Referred committees for consideration.

to Senate review and