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After just over a year in office as Mexico’s president, Claudia Sheinbaum ended the year with a strong push. With little protest from the business sector, the politician from the left-wing governing party Morena announced a 13-percent increase in the minimum wage, to take effect on 1 January 2026. More than 8 million workers stand to significantly benefit, as inflation is expected to fall below four percent for the first time in years. Sheinbaum also introduced a proposal in the Mexican Congress to gradually reduce the workweek from 48 to 40 hours.
Gerold Schmidt directs the Rosa Luxemburg Foundation’s Mexico City Office.
In addition, the president forced the resignation of the 86-year-old Alejandro Gertz Manero, a move many considered long overdue. The federal attorney general, often compared to a tortoise because of his sluggish response times, ran his office with little transparency, inefficiently, and in pursuit of personal interests. Drawing on her clear majorities in both the Chamber of Deputies and the Senate, Sheinbaum pushed through the appointment of her trusted and widely respected confidante Ernestina Godoy as the new federal attorney general within a matter of days. This opens the door to a broader reform of the country’s offices of public prosecution, whose unprofessional and often arbitrary practices are seen by critics as a major weakness of the Mexican justice system.
The judicial reform passed in June — which stipulates the popular election of the country’s most important judges — met with some rebuke internationally but caused less of a stir within Mexico itself. The Constitutional Court also has a new president, with the appointment of Hugo Aguilar, the first Indigenous person to hold the post. Aguilar has abolished several financial privileges previously enjoyed by the country’s top judges, and the nine justices have cut their salaries so that they no longer exceed that of the president.
Sheinbaum’s approval ratings remain extremely high, consistently above 70 percent. Slowly but steadily, the president is emerging from the seemingly overpowering shadow of her predecessor Andrés Manuel López Obrador (AMLO) and is leaving a clear mark on Mexican politics.
Her deft and unflustered handling of Donald Trump has also earned Sheinbaum respect among other political actors. On several occasions she has succeeded in using last-minute telephone calls with the US president to avert or soften his punitive tariffs. To date, the Mexican president has made no grave political mistakes, either domestically or in foreign policy.
Deft Domestic Policy
In the wake of protests by farmers against existing water access rights, Sheinbaum used the opportunity to push a new water law through the Chamber of Deputies. When extreme rainfall claimed dozens of lives a few weeks ago, flooding parts of the states of Veracruz, Puebla, and Hidalgo and rendering hundreds of rural communities inaccessible, Sheinbaum spent days on the ground, listened to criticism of the authorities, and personally pledged assistance.
In early November, a drunk man approached the president from behind and groped her as she walked through the centre of Mexico City. Sheinbaum filed a criminal complaint against the man but also used the incident to launch a campaign denouncing violence against women, prompting a wave of solidarity from large segments of the population.
The expansion of social programmes is proceeding rapidly as planned and has now benefited millions of people.
The UN Economic Commission for Latin America and the Caribbean (CEPAL) confirms that poverty is declining faster in Mexico than anywhere else in the region, leaving the country’s economy and currency stable. Although there will be no significant growth this year, the recession many feared would result from US tariffs failed to materialize. Exports to the US are even steadily increasing, and by September, foreign investment had already exceeded the full-year target of 40 billion US dollars.
As concerns matters of domestic security, the government claims that homicide figures are down more than 30 percent since Sheinbaum took office. If this trend proves to be statistically verifiable and continues, it will undoubtedly be lauded as one of the major victories of her administration. The scale of the challenge is illustrated by a single figure: on 25 September 2025, there were “only” 37 murders in Mexico, which marks the lowest number for a single day since the Morena party came to power in 2018. The political career of the security minister and Sheinbaum protégé Omar García Harfuch hinges on the fight against drug cartels and organized crime. At the same time, the president has stressed that brute force is not a solution to this complex problem: “Restarting the war against drug cartels is a step towards fascism,” she has said.
The expansion of social programmes is proceeding rapidly as planned and has now benefited millions of people. The government is also claiming new records in tax income, due to stricter collection and preliminary successes in combating corruption within the customs authority. Corporations still owe the tax authority SAT a combined amount of more than 1 trillion pesos, roughly equivalent to 50 billion euro. A systematic recovery of this money, including through court cases, is paying off for the state.
For the Sheinbaum government, so far this meant being able to finance social programmes without needing to raise taxes, thus postponing a larger conflict with Mexico’s opulent super-rich. The only exception is the case of the recalcitrant tax debtor Salinas Pliego. The businessman and media tycoon, an admirer of Argentina’s president Javier Milei and El Salvador’s authoritarian ruler Nayib Bukele, appears to be losing the now highly politicized fight with the courts and the government over the payment of his multi-billion-peso tax debts. Nevertheless, Pliego is still regarded as a possible presidential candidate for right-wing and far-right forces in 2030.
Right-Wing Parties Sidelined
The businessman is not particularly popular, however. Another possible far-right candidate, the former actor Eduardo Verástegui, recently squandered Trump’s trust by criticizing Milei. Within Mexico’s bishops’ conference — now fully purified of progressive thinking and liberation theologians — backing for arch-conservative currents is no longer disguised, yet the Church’s influence over the still predominantly Catholic population appears to be petering out.
Following its clear defeat in the presidential election, the right-wing conservative National Action Party (PAN) recently announced a relaunch. Yet despite receiving messages of support from the controversial former head of Mexico’s electoral authority, from former Spanish prime minister José María Aznar, and from the chair of the Mexican bishops’ conference, the promised relaunch appears to have fallen short of its aims. The Institutional Revolutionary Party (PRI), which governed until 2018 and had already taken a neoliberal turn in the 1980s, appears to have lost much of its purchase, while the Citizens’ Movement (MC) stands closer to the government than to the opposition on many issues.
Despite the weakness of the opposition, the Mexican government is far from anything like a safe position.
The Right’s attempt to mobilize Gen Z, by and large as disenchanted with politics in Mexico as elsewhere, failed spectacularly in mid-November. The turnout for a march against the current government was small, especially when compared to the capacity of the Sheinbaum administration to mobilize. Only 20,000 people took part in the rally, many of them the parents or grandparents of the ostensible target demographic. Nor did the Right garner substantial sympathy from its attempt to exploit the widespread outrage over the murder of the independent mayor Carlos Manzo in the state of Michoacán, likely ordered by drug cartels.
President Sheinbaum reaffirmed the current balance of power on 7 December, when she mobilized several hundred thousand people in front of the government palace to celebrate seven years of Morena party tenure.
Volatile Situation
Despite the weakness of the opposition, the Mexican government is far from anything like a safe position. Internal stability is highly vulnerable to external pressures. Whether the US president will seek to renegotiate the free trade agreement with Mexico and Canada next year or abandon the idea altogether remains entirely open. There has been little progress in the development of Mexico’s domestic market, and the country has a long way to go in realizing its explicit goal of diversifying its trading partners. Its own small and medium-sized agricultural sector was sacrificed to free trade, and discontent in rural areas continues to smoulder. Moreover, with most of AMLO’s flagship megaprojects now largely completed, infrastructure spending has bottomed out.
Mexico’s electricity production depends almost entirely on US gas supplies, in part due to the lack of domestic storage capacity. This leaves the government highly susceptible to external pressure. Trump continues to threaten direct military intervention against drug cartels in Mexico, and rumours of covert US intelligence operations carried out by US soldiers and possible drone strikes persist. While mass deportations of Mexicans from the United States have so far failed to materialize, they remain a real possibility which Mexico can prepare for only to a limited extent.
Additional points of conflict are emerging from the US National Security Strategy adopted in early December. Under Trump, the United States is reviving the 200-year-old Monroe Doctrine, which treats Latin America as an extension of the US sphere of influence and hence aims to prohibit intervention by other major powers. This is directed primarily against China, one of Mexico’s top trading partners. The doctrine also calls into question Mexico’s “historic support” (Sheinbaum) for the Cuban revolution.
One thing is certain: the photograph of a smiling President Sheinbaum alongside an equally cheerful Trump and Canadian Prime Minister Mark Carney at the embarrassing group draw for the 2026 World Cup is misleading. Foreign policy challenges are likely to intensify in the coming year and could at any moment exert a profound influence on domestic politics. What is equally clear, however, is that Mexico’s president — bolstered by broad domestic support — will be prepared to confront them.
This article first appeared in nd in collaboration with the Rosa Luxemburg Foundation. Translated by Hunter Bolin and Sam Langer for Gegensatz Translation Collective.
