
It was a show of strength: on 12 January, Mexico’s left-wing progressive President Claudia Sheinbaum celebrated amid a crowd of several hundred thousand people on the Zócalo, the main square in downtown Mexico City. In high spirits and buoyed by a popularity rating of between 70 and 80 percent, the nation’s first female leader took stock of her first 100 days in office.
Gerold Schmidt directs the Rosa Luxemburg Foundation’s Mexico City Office.
As she had stated prior to assuming office in October 2024, Sheinbaum intends for the most part to carry on the policies of her predecessor Andrés Manuel López Obrador (AMLO): expanding social programmes, giving the government more of a guiding role when it comes to the economy, and fostering an investment-friendly climate for businesses. And the head of government currently has the perfect domestic political conditions in which to implement her agenda. In contrast to the Lula government in Brazil, for example, which is forced to negotiate even simple parliamentary majorities, Mexico’s ruling MORENA party and its allies enjoy two-thirds majorities in both the Senate and the Chamber of Deputies. As a result, the new government has already been able to pass more than a dozen constitutional reforms — something that AMLO had previously been unable to do due to having lacked the qualified majorities.
The changes codified in the nation’s constitution include sweeping judicial reform and the recognition of Mexico’s Indigenous peoples as legal subjects, but also formally integrating the National Guard into the country’s military structures, implementing a pension scheme for those over the age of 65, and the right to free basic medical care.
When it comes to foreign policy, however, Sheinbaum finds herself in a considerably more complicated situation, and one dominated by Mexico’s relationship with its overpowering counterpart, the US, which is once again under the rule of Donald Trump as of 20 January. The issue of punitive tariffs and the threat of mass deportations of migrants from the US to Mexico are set to have a significant impact on Mexican domestic and economic policy. For weeks, Sheinbaum has reiterated the mantra that her country wishes to foster positive relations with its neighbour to the north — “but never a relationship of subordination”. This will now be put to the test.
“Shared Wealth”
To an even greater extent than her predecessor, Sheinbaum is focusing on cooperating closely with the private sector. The day after making her appearance at the Zócalo, she presented her Plan México, which aims to boost the country to the position of the world’s tenth-largest economy and make it “the greatest country in the world”.
The plan also includes the expansion of several ports and rail transportation systems in the country’s north. It is hoped that investment incentives will promote the ongoing industrialization of the country in line with “modernizing development”. The president is also doing justice to her reputation as an environmental scientist: preparations are underway to establish Mexico’s own state-run production of small electric cars. One of the three planned vehicle designs will be driven into the Estadio Azteca on 11 June 2026 for the opening of the World Cup, which is being held in cooperation with the US and Canada.
Sheinbaum aims to increase the national share of goods production and supply chains without foregoing international investment. In a move reminiscent of Trump, she has promised to curb China’s economic influence in Mexico. In so doing, she has also pursued symbolic policies, such as seizing cheap Chinese counterfeit products and implementing import tariffs of 20 percent for clothing items from the Chinese companies Shein and Temu, garnering her administration much publicity.
By continuing her daily morning press conferences, Sheinbaum, like her predecessor, will determine the country’s political agenda from one day to the next.
In addition to this, Sheinbaum is also clearly committed to the USMCA free trade agreement with the US and Canada, which replaced the NAFTA agreement in 2020. The USMCA is set to be renegotiated in 2026. Donald Trump believes that the agreement disadvantages the USA and is threatening to withdraw from it. In the face of an ongoing barrage of verbal attacks from Washington, Sheinbaum only subtly hinted that Mexico would be forced in this case to increasingly turn to other trading partners. Against this backdrop, mid-January’s “modernization agreement” regarding the free trade agreement between Mexico and the EU represents a welcome and timely development for the Mexican government.
For Sheinbaum, the bottom line is that she expects Plan México to ultimately result in “shared wealth”, which would in turn lead to a reduction in social inequality. However, she still does not consider it necessary to implement a structural tax reform that would increase the tax burden for high-income earners.
The vast majority of the business community has welcomed its cooperation with Sheinbaum’s administration and has been accommodating of her endeavours. The umbrella organization CCE floridly declared that it would embrace “the human content of this new era” and emphatically approved a planned annual 12-percent increase to the minimum wage. With inflation currently sitting at just over four percent, some 8 million workers can expect to see a significant increase in real wages.
Sheinbaum has been able to operate within a relatively stable macroeconomic climate during her first few months in office. Foreign investment is projected to hit a record level of roughly 40 billion US dollars in 2025, while the foreign currency reserves of Mexico’s central bank have reached an all-time high of 230 billion US dollars. Remesas, the money sent by Mexicans living in the US to their families in Mexico, also reached a new high of approximately 66 billion dollars in 2024. Despite the large sum, it constitutes only 3.5 percent of the nation’s gross domestic product. This is considerably less than the equivalent figures for the smaller Central American economies, for example, and means that Mexico is less economically vulnerable.
Even under Sheinbaum — and in spite of Trump — the Mexican peso has thus far remained more or less stable. While national debt rose to just over 50 percent of GDP last year, it is nonetheless comparatively low by international standards.
Expanding Social Programmes
The government will only be able to maintain its tremendous support among the general population if it succeeds in delivering on social policy, which is why Sheinbaum is also moving up a gear in this area. This year, per-capita social welfare expenditure reached an all-time high. The rollout of new programmes, promised in the party’s election manifesto, will be staggered but swift. For example, women will receive a basic pension from the age of 60, in a move that goes beyond the government’s constitutional obligation.
Meanwhile, the government is also turning its attention to the younger generations. Under AMLO, there was a scholarship programme for high school students, from which roughly one million young people benefited. Sheinbaum intends to begin payments at pre-school age and ultimately reach more than 20 million children and young people.
Another point of action is to boost construction of social housing and restructure the sector, which has grappled with rampant corruption for decades. Further government initiatives target education and care programmes in the cities.
Bucking the global trend, a clear majority of Mexico’s population maintains its confidence in a left-wing progressive party in office — making the country quite unique indeed on the global stage.
Mexico City, a metropolis of some 25 million people, is leading the way. The number of PILARES hubs (in Spanish: Puntos de Innovación, Libertad, Arte, Educación y Saberes, or Points of Innovation, Freedom, Art, Education, and Knowledge), which Sheinbaum first introduced during her tenure as the city’s mayor, is being significantly increased, and the free service will gradually be rolled out across the country. In the capital, the PILARES programme is being supplemented by the new mayor Clara Brugada (MORENA) with her UTOPIAS initiative, which takes a similar approach. Brugada is also forging ahead with transport subsidies for university students and schoolchildren in the nation’s capital, as well as benefit payments for families with small children.
One new element that combines economic and social policy in predominantly rural areas is direct allocations made to Indigenous and Black Mexican communities for “social infrastructure”, with the funds coming straight out of the federal budget. These payments are an outcome of the aforementioned constitutional reform, which recognizes these peoples and communities as legal subjects in Article 2 of the Mexican constitution.
Threatening Rhetoric from Trump
Not everyone shares Sheinbaum’s optimism that these social programmes will be able to be financed in the medium and long term. Mexico’s healthcare system is still in need of large-scale investment if it is to ensure and improve basic public health services. The outlook is much the same in the education sector. What’s more, the economic growth forecast for the coming years of between 1.5 and 2.5 percent is unlikely to generate any substantial additional revenue for the state. This means that the country’s successful social policy programme could soon reach its financial limits unless new sources of funding are secured.
And regardless of how much Mexico tries to steel itself, if Donald Trump were to follow through on his threats against Mexico, the very stability of the country could be in jeopardy. Trump’s arsenal of threats includes not only punitive tariffs and deportations, but also unilateral US military strikes and interventions against the cartels, which have been designated as “terrorist”. Actions such as the United States’ sudden withdrawal from the USMCA or sanctions imposed by the US due to Chinese investments in Mexico would also severely impact the country. Yet hope still prevails in Mexico that the Trump administration would ultimately end up shooting itself in the foot with many of the threatened actions, and would therefore refrain from following through. But nobody can be sure when it comes to Trump.
Despite the threat from without, the only thing that would feasibly hinder the Mexican government and the MORENA party at the moment is themselves. With her swift implementation of new social programmes, Claudia Sheinbaum has masterfully navigated her first 100 days in office. By continuing her daily morning press conferences, she, like her predecessor, will determine the country’s political agenda from one day to the next. The opposition, on the other hand, which spans the political spectrum from conservative to right-wing authoritarian, does not currently constitute a meaningful political force — it neither presents a united front, nor does its discourse appeal to the broader population.
But it is not as if Sheinbaum’s government has presented zero grounds for criticism — it has, for example, defended the growing military influence in the civilian sectors of Mexican society. Moreover, Sheinbaum has yet to demonstrate that she is capable of curtailing the violence of organized crime, nor of shedding light on the fate of the more than 120,000 people who have disappeared as a result.
Nevertheless, bucking the global trend, a clear majority of Mexico’s population maintains its confidence in a left-wing progressive party in office — making the country quite unique indeed on the global stage. Seen from this perspective, Sheinbaum and the MORENA government remain a genuine beacon of hope in these otherwise dark times.
This article first appeared in nd.Aktuell in collaboration with the Rosa Luxemburg Foundation. Translated by Louise Pain and Rowan Coupland for Gegensatz Translation Collective.