Mexico's 2024 Presidential Election: Sheinbaum's Vision and Potential Implications for U.S.-México Ties

Introduction

The 2024 presidential election in Mexico is set to be historic. On June 2, millions of Mexican citizens will vote for a new president, along with all members of the Chamber of Deputies, the Senate of the Republic, eight governors, the Head of Government for Mexico City, 31 local congress people, and other representatives nationwide.

Photo by Ricky Esquivel: https://www.pexels.com/photo/people-near-mexican-flag-1573471/

This election could potentially see the first woman elected as president, marking a significant milestone for the country. Former Mexico City Mayor Claudia Sheinbaum, frontrunner for López Obrador’s governing Morena coalition, We Keep Making History (Seguimos Haciendo Historia), will compete against Senator Xóchitl Gálvez of the Strength and Heart for Mexico (Fuerza y Corazón por México) alliance. This alliance is the main opposition coalition, comprising the National Action Party (PAN), the Institutional Revolutionary Party (PRI), and the Party of the Democratic Revolution (PRD). In December 2023, Nuevo León Governor Samuel García of the Citizen's Movement (Movimiento Ciudadano/MC) party withdrew his candidacy, and his campaign coordinator, Jorge Álvarez Máynez, a federal deputy, has taken his place. (Zissis, 2024). According to the poles, Scheinbaum is the clear frontrunner, followed by Gálvez and Máynez in the last place.

Bloomberg, LSEG, CE BofA

The upcoming presidency of Mexico will undoubtedly face "intermestic" challenges, meaning that local issues become agendas of interest for other countries, such as its neighbor and largest trading partner, the United States. The outcome of these elections is important for the U.S., not only because Mexico is the second-largest economy in Latin America but also because the victor signifies continuity or a change in foreign policy. Each government adds different nuances and influences the closeness or distance of relationships with some countries, which is related to ideology. Therefore,  the outcome of the U.S. elections will also be important in considering the relationship between both countries.

Next, we'll delve into four key areas where the policies of Mexico's next government will influence U.S. political agendas: shared security challenges, migration, energy and nearshoring, and the USMCA.

Shared security challenges

Firstly, the illicit trafficking of fentanyl and firearms is an issue that has sparked debates within both countries. According to the Wilson Policy Center, “Mexico denies illicitly manufactured fentanyl is produced in the country and has characterized accidental overdoses as a US problem with seemingly little empathy for the loss of life” (Wilson Center & Mexico Institute, 2024, 39). Beyond the oversimplification of this accusation, the issue of drug trafficking is deeply rooted in Mexico, and there are different perspectives within politics on how to address it. Xochitl Gálvez, similar to Bukele (current president of El Salvador), has expressed her stance on waging a war against narco-trafficking and constructing mega-prisons to incarcerate such criminals. This aggressive approach is countered by Claudia Sheinbaum, who has clearly differentiated her approach from that of the opposition, focusing on "peace-building" rather than a war on drug trafficking. Her approach involves long-term policies aimed at engaging young people through education, including the construction of public universities, to prevent them from turning to crime. The question remains: will this approach be enough?

Migration

Migration is perhaps the consummate intermestic issue facing the next president. In terms of the measures to be taken, Sheinbaum clearly marks continuity with the current President López Obrador. In the short term, she proposes the construction of an industrial hub in the south of the country with the goal of creating jobs, containing migration from a labor perspective, and "dignifying migration" with a human rights approach.

However, she believes that it is not only Mexico that must implement policies to contain migratory flows, as people do not migrate by choice but out of economic necessity. In this sense, the long-term policy regarding migrations must come from the U.S., which must have a strong policy of development cooperation not only towards Mexico but also towards other countries in the Central American region. Sheinbaum argues that if there is development, there is no reason to emigrate. History indicates that if Trump comes to power, the Republic of Mexico will have to assume more responsibilities in terms of migration.

Energy and nearshoring

The management of the energy issue by the next government of Mexico is crucial for the United States due to the phenomenon of nearshoring. Nearshoring involves the relocation of activities of U.S. companies to nearby territories, such as Mexico, rather than distant locations like Asia. The aim of nearshoring is to leverage geographic proximity and lower transportation costs, among other benefits. For Mexico, nearshoring entails a significant increase in energy demand.

In the last decade, Mexican governments have experienced opposite extremes in their energy policy. In 2013, former President Enrique Peña Nieto introduced his energy reform plan, which encouraged private investments to steer the course of the main national oil company, PEMEX. PEMEX currently faces a serious unfavorable outlook in terms of corruption, production declines, and high levels of debt. However, these investments did not materialize because the current president, Andrés Manuel López Obrador, opposed them. The Morena candidate has expressed, as in other areas, a program of continuity with her predecessor, opposing the privatization of the energy sector and continuing to support the energy sovereignty of PEMEX. While the source of funds is not clear, Sheinbaum has expressed in media outlets such as Bloomberg News her desire to renegotiate PEMEX's debt and consider a long-term decarbonization plan for the economy, betting on cleaner energies for the future.

According to the Wilson Center, the next government of Mexico should create investment-friendly environments to revive private sector enthusiasm in the energy sector. This entails providing a level playing field in regulatory matters to private companies with respect to PEMEX, while also allowing and encouraging public-private partnerships. (Wilson Center & Mexico Institute, 2024).

The USMCA

The USMCA is a trade agreement that replaces the North American Free Trade Agreement (NAFTA). Signed in 2018 and in effect since July 2020, it establishes trade rules between the three countries in areas such as trade of goods and services, intellectual property, investment, and labor and environmental standards. The main goal of the USMCA is to modernize and strengthen trade relations between Mexico, the United States, and Canada.

Candidate Scheinbaum expressed that regardless of who enters the White House in the next year, she views the possibility of continuing economic integration and reinforcing existing agreements positively. However, she strongly emphasized her stance of defending Mexicans abroad and positioned herself against any form of discrimination. Regarding the agreement, Scheinbaum proudly mentioned in various interviews that Mexico was consecrated as the main trading partner of the United States in 2023. In fact, she has already organized a working group led by Juan Ramón de la Fuente (possible future chancellor) aimed at outlining the main points to be raised by Mexico in the revision of the USMCA scheduled for 2026. As Phelan states, “The sunset clause (of the USMCA), requiring a renewal decision by 2026, injects a sense of urgency into resolving newfound challenges, emphasizing the need for active engagement from all stakeholders.” (Phelan, 2024)

There has been a strong emphasis on ensuring that these points are not determined solely by the state. Instead, a constant dialogue with the business sector is established to consider their demands when revising the treaty. Despite the desire for continuity, the candidate did not provide details on specific chapters of the agreement and changes that could be proposed from Mexico, as the matter is still under internal negotiations.

Conclusions

In general, Sheinbaum’s viewpoints were outlined as she is the most likely candidate to assume the presidency. Looking ahead to 2025, if Donald Trump were to become president again, tensions might arise due to his emphasis on border security and immigration control. Conversely, a Biden presidency could lead to a more cooperative approach, prioritizing economic cooperation, environmental sustainability, and human rights, potentially fostering enhanced collaboration between the two countries.

References

Phelan, R. (2024). Can the USMCA Compete in a Globalized World? Mathurin Hybrid Initiative. https://www.mathurinhybridinitiative.org/post/can-the-usmca-compete-in-a-globalized-world

Wilson Center & Mexico Institute. (2024). MEXICO’S NEXT PRESIDENT: CHALLENGES AND RECOMMENDATIONS.

Zissis, C. (2024, April 30). Poll Tracker: Mexico's 2024 Presidential Vote. AS/COA. Retrieved May 5, 2024, from https://www.as-coa.org/articles/poll-tracker-mexicos-2024-presidential-vote