March 22-28, 2025
HOT TOPICS:
Trump imposes 25%tariffson autoimportstotheUS
THE WATER AGREEMENT BETWEEN MEXICO AND THE US
The 1944 U S -Mexico Water Treaty, designed to allocate water from shared rivers equitably, is under strain due to Mexico's failure to meet its water delivery obligations to the United States This shortfall has prompted the U.S. to deny, for the first time, Mexico's request for Colorado River water deliveries to Tijuana, exacerbating water scarcity in Baja California. The dispute intensifies tensions between the two nations and poses significant risks to Mexican industries, particularly agriculture, which relies heavily on consistent water supplies Reduced water availability could lead to decreased crop yields, threatening food security and the livelihoods of farmers Additionally, industrial sectors dependent on water may face operational challenges, potentially deterring foreign investment and hindering economic growth Addressing these issues requires collaborative water management strategies and infrastructure improvements to ensure equitable resource distribution and mitigate the adverse effects on Mexico's economy.
Source: EL PAÍS
On March 26, 2025, U S President Donald Trump announced a 25% tariff on imported automobiles and select auto parts, effective April 2, aiming to boost domestic manufacturing. This move sparked strong reactions from key trading partners, including Mexico, Canada, and the European Union (EU). Mexican President Claudia Sheinbaum reaffirmed that the United States-Mexico-Canada Agreement (USMCA) prohibits such tariffs and pledged a formal response after April 3 Economy Secretary Marcelo Ebrard highlighted Mexico’s significant role in U.S. auto production, stressing efforts to avoid multiple tariff charges, maintain competitive pricing, and secure exemptions for vehicles meeting USMCA rules A negotiation table has been established to protect Mexico’s industry
Canadian Prime Minister Mark Carney condemned the tariffs as a “direct attack” and announced a C$2 billion fund to support the automotive sector Canada is considering retaliatory tariffs and export duties on U S goods, with a C$155 billion response package prepared Carney also emphasized the need for new trade partnerships Trump warned Canada and the EU against retaliating, threatening additional tariffs. His announcement caused global auto stocks to plunge, raising concerns over supply chain disruptions and rising car prices. Countries like Germany, Japan, and South Korea have responded with investment plans or calls for negotiations to prevent further escalation. The decision is widely seen as a potential trigger for broader trade conflicts.
Source: THE WHITE HOUSE
SECURITY EFFORTS BETWEEN MEXICO AND THE US CONTINUE
U S Secretary of Homeland Security Kristi Noem will visit Mexico today, March 28 to meet with President Claudia Sheinbaum and Foreign Minister Juan Ramón de la Fuente. Her visit, part of a Latin American tour, follows Trump’s efforts to expand migrant deportations, including non-Mexican nationals. Meanwhile, Mexican authorities have intensified security efforts, deploying 10,000 National Guard troops to curb migration and fentanyl trafficking In parallel, the extradition of drug lord Rafael Caro Quintero has fueled tensions, as the U.S. considers seeking the death penalty Sheinbaum asserts that Mexico’s security strategy has reduced homicides and earned U S praise Trump has linked Mexico’s cooperation to tariff threats, underscoring the complex bilateral security and trade dynamics
Source: INFOBAE
HOT TOPICS:
Judicial Electionposesdemocracy concerns
The National Electoral Institute (INE) has established guidelines to supervise the judicial election process in Mexico, ensuring transparency in campaign financing and candidate conduct Candidates can use social and digital media for promotion, but the INE will monitor their activities The Electoral Tribunal (TEPJF) ruled that candidate registration cancellations should not be limited to only two violations receiving illicit funds and attending political events but should cover all potential infractions, including exceeding spending limits or unauthorized advertising
Meanwhile, concerns have arisen regarding the election’s legitimacy Judge Juana Fuentes Velázquez warned that the June 1 election could undermine judicial independence and solidify authoritarian rule She urged international intervention to halt the process, arguing that the government seeks to control the judiciary Additionally, tensions within the ruling party, Morena, have increased due to a survey indicating that only 20% of the population is aware of the election. This raises concerns about voter turnout, which is crucial for justifying the reform The government fears that low participation could provide an opportunity for the opposition to regain influence Morena is intensifying its electoral strategy to boost awareness and engagement. The judicial election remains highly contested, with debates over its democratic implications and the role of citizen participation
Source: PROCESO
MEXICAN EXPORTS FALL IN FEBRUARY
In February 2025, Mexican exports fell 2 9% year-on-year to $49 28 billion, mainly due to declines in automotive (-15.2%) and petroleum exports. Automotive sales to the U S dropped 10 7%, while those to other markets plunged 40 2% Imports also decreased by 8 3%, resulting in a trade deficit of $2 21 billion Agricultural exports declined 6 1%, with significant drops in beef (-73 2%) and fresh vegetables (-18 6%), though avocado (+34%) and frozen shrimp (+75.5%) saw gains. Oil exports totaled $1 99 billion, with crude averaging $68 99 per barrel Capital goods imports fell 11 9%, while intermediate goods declined 7 5%
Source: EL ECONOMISTA
WALMART TO INVEST $6 BILLION USD IN 2025
Walmart Mexico and Central America will invest over $6 billion in 2025 to expand its store network and build two new distribution centers in Bajío and Tlaxcala, incorporating robotics and AI. This investment will create 5,500 direct jobs, adding to the 200,000 already in the country CEO Ignacio Caride reaffirmed Walmart’s long-term commitment to Mexico The company also supports the “Made in Mexico” initiative, with 85% of its 30,000 suppliers being small and medium enterprises and 83% of its products locally made. The investment aligns with the Mexico Plan, strengthening Walmart’s omnichannel presence.
Source: EL ECONOMISTA BANXICO CUTS INTEREST RATE
The Bank of Mexico (Banxico) cut its interest rate by 50 basis points to 9 0%, marking the second consecutive reduction Analysts expected the move but were surprised by the possibility of further similar cuts Banxico sees lower rates aligning with economic challenges, maintaining a restrictive stance while considering weak economic activity Experts highlight the need for caution due to inflation risks. Banxico kept its inflation forecast, expecting convergence by Q3 2026, citing geopolitical and economic uncertainties.
Source: EL FINANCIERO
HOT TOPICS: Legislative and Regulatory Issues:
LABOR
BILL TO AMEND ARTICLE 132 OF THE FEDERAL LABOR LAW
Presented by: Sen María Del Rocío Corona Nakamura (Jal - PVEM)
Objective: Mandates employers to grant 20 working days of paid paternity leave for male workers upon childbirth or adoption
Status: 2025-03-27 - Published in the Parliamentary Gazette
BILL TO AMEND ARTICLE 123 OF THE CONSTITUTION
Presented by: Sen Geovanna del Carmen Bañuelos De la Torre (LNalMORENA)
Objective: Recognizes independent workers as individuals who engage in personal economic or professional activities without employer dependency
Status: 2025-03-27 - Published in the Parliamentary Gazette
BILL TO AMEND AND ADD TO ARTICLE 371 OF THE FEDERAL LABOR LAW
Presented by: Dip Aciel Sibaja Mendoza (Plur - MORENA)
Objective: Guarantees proportional gender representation in union leadership, ensuring full and equal participation of women It mandates that executive positions and union structures at all levels be equitable, with gender alternation and equal conditions
Status: 2025-03-25 - Published in the Parliamentary Gazette
POLITICAL
BILL TO AMEND ARTICLE 211 BIS 1 OF THE FEDERAL PENAL CODE
Presented by: Dip Victor Manuel Pérez Díaz (Plur - PAN)
Objective: Establishes that unauthorized access to computer systems or protected data to steal, modify, destroy, copy, or alter information constitutes a crime. The penalty will be 3 to 10 years in prison and a fine of up to 1,000 Units of Measurement and Update. If the crime causes psychological or material harm to the victim, the penalty will be increased by one-third
Status: 2025-03-26 - Published in the Parliamentary Gazette
BILL TO AMEND THE FEDERAL PENAL CODE BY ADDING ARTICLE 252 BIS
Presented by: Sen Rafael Alejandro Moreno Cárdenas (LNal - PRI)
Objective: Establishes that identity theft, including unauthorized use or appropriation of another's identity to cause harm or gain undue profit, is a crime punishable by 2 to 5 years in prison and fines of 200 to 1,000 UMA, along with potential restitution The same penalties apply to the use of AI software to create, distribute, or manipulate content with the intent to impersonate someone AI is defined as systems capable of performing tasks traditionally requiring human intelligence, such as natural language processing and machine learning
Status: 2025-03-25 - Published in the Parliamentary Gazette
FINANCIAL
BILL TO ADD VARIOUS PROVISIONS TO THE INCOME TAX LAW
Presented by: Dip Marcelo De Jesús Torres Cofiño (Plur - PAN)
Objective: Provides a tax incentive for income tax payers whose earnings come from exports affected by tariffs imposed by other countries The incentive is a tax credit of 30% of the tariff costs, applied against income tax for the year the credit is determined The credit can be carried forward for up to four years An Interinstitutional Committee, with representatives from various government agencies, will oversee the implementation of this tax benefit and publish the relevant rules for its granting
Status: 2025-03-26 - Published in the Parliamentary Gazette
