USMCA Talks: Mexico’s High-Stakes Negotiation

The commencement of USMCA negotiations on March 16 represents the most positive economic news, as it charts a course for deeper integration between the United States and Mexico. The discussions will involve President Claudia Sheinbaum and President Donald Trump outlining a roadmap extending to 2042, the agreement's expiration date.

However, the negotiation between the teams led by Marcelo Ebrard and Jamieson Greer is anticipated to be the most difficult, surpassing the complexity of both Carlos Salinas's NAFTA and Enrique Peña Nieto's USMCA negotiations.

Trade experts categorize this development into two perspectives. The first is simply "good": the process is beginning, and it is not in Mexico's interest to negotiate without Canada. The second is concerning: the decision to divide the review by topic, rather than agreeing on a comprehensive plan from the outset, makes Mexico vulnerable. This approach engages with U.S. priorities and excludes Canada, whose prime minister is Mark Carney, in a strategy to divide the parties.

Initially, the topics to be addressed are China, its overwhelming commercial advance, and the relationship that Xi Jinping's regime maintains with Mexico, a source of significant discomfort for Trump. The real negotiations began some time ago. Formalizing the process helps bring it into public view, thereby reducing hidden pressures and activating U.S. counterweights. In other words, as the saying goes: a good sign, but no cause for celebration. Or as Winston Churchill stated: "It is not the end, it is not even the beginning of the end, but it is the end of the beginning."

United States negotiators, led by Commerce Secretary Howard Lutnick, will maintain a tough stance, seeking to force Mexico to agree to their positions. They will exert pressure on political issues, ranging from the war against drug cartels to the threat of unilateral termination of the USMCA should negotiations fail.

Mexican negotiators must remember that the most interested parties in preserving the USMCA are the owners of capital in the United States. This includes industrial and service conglomerates, financial groups, and investors in general, who are demanding the agreement remain in force and will not permit its termination.

U.S. negotiators will pressure Mexico to guarantee preferential treatment for American investors, particularly in the energy, oil, and minerals sectors. They will criticize the partnership rules governing new projects for Pemex, headed by Víctor Rodríguez Padilla, and the Federal Electricity Commission (CFE), headed by Emilia Esther Calleja Alor. Mexico should not accept such an imposition, as it would create a dangerous dependence on the United States in highly sensitive areas. With an unpredictable U.S. government, allowing this dependence, which reduces Mexico's margins of autonomy, is doubly risky. The mettle of Mexico's negotiators will be tested.

In a related development, the Federal Electricity Commission (CFE), headed by Emilia Calleja, is entering a new phase in the development of the Puerto Peñasco Photovoltaic Park in Sonora. This fourth phase envisions constructing approximately 280 megawatts of capacity with an estimated investment of nearly $400 million. The process is now at a critical stage, with five consortia under evaluation. Participants include prominent international players, primarily Chinese state-owned companies and some Spanish firms: China Energy International, led by Song Hailiang; Power China Jiangxi Electric Power Construction, headed by Ding Yanzhang; Eléctrica Aselco, led by Edgardo Meade; Entia de México, headed by Jerónimo Macorra; and TSK Electrónica y Electricidad, led by Joaquín García Rico. The key date is March 11, when the state-owned company must issue its technical report to determine which proposals meet the requirements, defining who advances in one of the most significant solar projects promoted by the federal government.

Separately, Alfredo Domínguez Marrufo, director of the Federal Center for Conciliation and Labor Registration, appears to be an accomplice of Alejandro Martínez Araiza, leader of the National Food and Commerce Union (SNAC). Domínguez Marrufo is accused of protecting Martínez Araiza from reporting the alleged misuse of 500 million pesos in union dues diverted to personal accounts over six years. The 17,000 union workers, employed by companies such as Mondelez, PepsiCo, Sabritas, Barcel, Mars, Sigma Alimentos, Alpura, and Pan Ideal, denounce corruption by this official and others within the Ministry of Labor, who they allege are shielding the plundering of union funds with impunity. On May 19, 2025, Domínguez Marrufo sent an official letter to Martínez Araiza requesting information on the use of union funds. The SNAC leader reportedly responded that he would not comply, claiming 97% of unions do not. Officials from the current administration are alleged to be protecting him, a situation that may displease Secretary of Labor Marath Bolaños, who is committed to fighting corruption.

On the economic front, the formal labor market closed February with positive figures: 22.7 million jobs were registered with the Mexican Social Security Institute (IMSS), headed by Zoé Robledo, with almost 87% being permanent positions. This indicates a consolidation of the labor base despite a fragile economic environment. The monthly increase of 182,000 IMSS-registered jobs is the highest recorded for a February, confirming momentum at the start of the year. However, the annual growth rate of 1.2% demonstrates this is not an accelerated expansion but a controlled advance. Wage data shows a positive shift, with the average daily base income reaching 664 pesos, the highest recorded by the Ministry of Labor under Marath Bolaños, suggesting formal employment is growing in both number and value. It falls to the current administration to sustain this growth without allowing economic slowdown to impact employment and income.

In the energy sector, the Trión Field is more than a complex engineering project; it is the first test of Mexico's potential as a serious player in deepwater drilling. Australian company Woodside, led by Meg O'Neill, and Pemex, led by Víctor Rodríguez Padilla, are betting on a development that, with 24 wells at depths exceeding 2.5 kilometers, demands a logistics chain capable of sustaining high-risk, high-cost operations. The arrival of the Deepwater Thalassa vessel in Tamaulipas will generate port activity, specialized jobs, and a direct boost to regional suppliers. The Tláloc platform and the FSO Chalchi will form the core of a system designed to operate for decades, with projected tax revenues exceeding $10 billion.