In the first week of September, Mexico saw developments in bilateral relations with the United States and major domestic political milestones, while its economy maintained momentum despite ongoing challenges. From President Claudia Sheinbaum’s first annual government report and a new Supreme Court to security collaboration with Washington, Mexico’s constantly evolving political landscape and its complex relationship with its northern neighbor were front and center this week.
Against the backdrop of the political developments, a financial tech firm achieved unicorn status after acquiring a bank targeted by U.S. sanctions, Hurricane Lorena brought torrential rain to northwest Mexico and Mexico registered a conservation win.
Didn’t have time to read all the top stories of the week? Here’s what you missed.
Mexico-U.S. relations take center stage
The week’s most significant diplomatic development came with U.S. Secretary of State Marco Rubio’s visit to Mexico City, resulting in the establishment of a new bilateral security cooperation program but falling short of the agreement President Sheinbaum had previously hoped to sign this week. The announcement followed months of tension over trade tariffs and security concerns.
President Sheinbaum praised the Mexico-U.S. relationship ahead of the Rubio meeting, emphasizing that despite difficulties, Mexico must maintain good relations with its neighbor, citing the 40 million Mexicans living in the United States and the countries’ extensive trade partnerships.
The new bilateral security group represents what Rubio described as “the closest security cooperation we have ever had, maybe with any country.” The high-level implementation group will meet regularly to coordinate efforts against cartels, strengthen border security, address illicit financial flows, and enhance collaboration to prevent fuel theft while increasing inspections and prosecutions to stop drug and arms trafficking.
Sheinbaum and Rubio announce establishment of new bilateral security group
However, tensions persisted throughout the week. Sheinbaum pushed back on Trump’s claims that she is “scared” of drug cartels, calling the assertion untrue while maintaining her commitment to a respectful bilateral relationship. She later described the new Mexico-U.S. security program as “good for the country”, emphasizing that the plan will advance cooperation in intelligence sharing and training while maintaining Mexico’s sovereignty.
The potential for conflict was on full display late in the week, when Chicago event organizers canceled September’s Mexican Independence Day festivities, which function as a celebration of Mexican heritage in the U.S. Organizers cited the risk of racial profiling and lack of due process at recent immigration raids across the U.S.
Public opinion reflects the complexity of the relationship. A poll published this week showed that 51% of Mexicans believe the bilateral relationship with the U.S. is in bad shape, with 56% rating Sheinbaum’s handling of the Trump relationship as poor. Despite these challenges, two-thirds of respondents oppose U.S. military intervention against cartels in Mexico, while 72% support the handover of cartel figures to U.S. authorities.
Judicial transformation begins
Sept. 1 marked a historic milestone with Mexico’s new Supreme Court taking the bench. The nine newly elected justices, chosen through the country’s first-ever judicial elections in June, began their terms, reducing the court from 11 to nine members and eliminating the previous two-chamber system.
The transformation represents what Sheinbaum calls “the end of an era of nepotism in the judiciary.” However, critics argue that all nine justices are affiliated with or sympathetic to the ruling Morena party, potentially eliminating vital checks on executive and legislative power. The new court faces an immediate challenge with a historic backlog of 552,800 active unresolved cases, 25% more than a year earlier.
Presidential milestone and national tour
Sheinbaum delivered her upbeat first government report in a 70-minute address at the National Palace, highlighting achievements across security, economy and social programs.
“We’re doing well and we’re going to do even better,” the president said, citing a 25% reduction in homicides over 11 months, economic growth despite international forecasts, and expanded welfare programs reaching 32 million families.
Following the report, Sheinbaum announced an ambitious national tour to visit all 32 states in three and a half weeks, presenting individual reports for each entity alongside their governors. With the new outreach effort, the administration seeks to demonstrates it’s commitment to direct accountability to the people.
Economic momentum continues
Mexico’s economic relationship with the United States showed resilience despite ongoing trade tensions. Mexican exports to the U.S. continued to grow, reaching a record high of $45.36 billion in July, an 8.2% annual increase. For the first seven months of 2025, Mexican exports to the U.S. totaled $309.75 billion, up 6.5% year-over-year, maintaining Mexico’s position as the United States’ top trading partner.
The financial sector achieved a significant milestone as fintech firm Kapital became Mexico’s latest unicorn, reaching a $1.3 billion valuation after raising $100 million in Series C funding. The achievement comes shortly after Kapital’s acquisition of Intercam Bank, which the U.S. accused of money laundering and sanctioned in June — effectively cutting Intercam off from the U.S. banking system.
Fintech firm Kapital is Mexico’s latest unicorn, valued at over US $1B after acquiring Intercam Bank
Additional business developments included Binance’s announcement of a $53 million investment to expand crypto operations in Mexico and plans for Latin America’s biggest Costco store in Monterrey, reflecting continued international confidence in the Mexican market.
Other notable developments
The week saw various other significant stories. Mexico confirmed that works created by AI cannot be granted copyright protection, placing the country at the forefront of intellectual property discussions surrounding artificial intelligence. Environmental news included reports that Mexico’s jaguar population is making a comeback, offering hope for conservation efforts.
Weather-related challenges included Hurricane Lorena brought heavy rain to Pacific Mexico. The storm failed to make landfall in Baja California as initially predicted, but still caused significant damage and flooding across multiple regions. Security concerns persisted with a state official killed by gunfire on a Guerrero highway and U.S. authorities seizing methamphetamine precursor chemicals linked to the Sinaloa Cartel.
Economic challenges included remittances to Mexico sliding for the fourth consecutive month, while environmental efforts continued with the Nuevo León Congress pushing for polluting steel plants to leave Monterrey.
Looking ahead
The first week of September 2025 established several key themes that will likely define Mexico’s trajectory in the coming months. With the new security cooperation program, Mexico and the United States have a framework for addressing shared challenges while respecting Mexican sovereignty, but whether it results in significant progress remains to be seen.
The launch of Mexico’s democratically elected judiciary marks perhaps the most significant institutional change in the country’s modern history, yet its true impact on governance and rule of law will unfold over years, not months. Similarly, the economic data revealing record export levels amid ongoing trade disputes suggests that Mexico’s integration with North American markets has achieved a resilience that transcends political rhetoric.
Sheinbaum must walk a delicate line between a Mexican public that values sovereignty and a U.S. administration that expects obedience on shared challenges. Her success will ultimately be measured not by diplomatic agreements, but by her ability to extract meaningful concessions from Washington while maintaining the nationalist credentials that underpin her domestic popularity.
Mexico News Daily
This story contains summaries of original Mexico News Daily articles. The summaries were generated by Claude, then revised and fact-checked by a Mexico News Daily staff editor.
