Victims in the accident that destroyed the Francis Scott Key Bridge in Baltimore Tuesday included three Mexican nationals, the government of Mexico said Wednesday. (Screen capture)
President Andrés Manuel López Obrador told reporters that three Mexican workers were on the Francis Scott Key Bridge in Baltimore, Maryland, when it collapsed after a cargo ship struck a support column on Tuesday.
One of the three was rescued, but two are still missing, he said.
President Lopez Obrador declined to share the names of the victims, saying that their families in Mexico were highly sought after by the media. (Presidencia)
“The report we have is that there are three Mexicans, one was rescued and came out alive— injured, but safe,” López Obrador said during his Wednesday morning press conference, adding that consular assistance is being provided to the relatives. At least eight people went into the water. Two were rescued, but the other six are missing and presumed dead.
The Mexicans were part of a construction crew filling potholes on the bridge. President López Obrador said the families of the victims are being highly sought after by the media and refrained from giving further details about their relatives.
The Foreign Affairs Ministry said in a statement Wednesday that the Mexican rescued alive is from Michoacán. One of the missing men is also from the state of Michoacán, and the other is from the state of Veracruz, it added.
Guatemalan and Honduran diplomats have confirmed that some of the missing workers on the crew are their nationals.
On Tuesday evening, Maryland State Police announced that the search and rescue mission was transitioning to one of search and recovery. Maryland Governor Wes Moore said Wednesday morning that rescue divers faced dangerous conditions.
“They are down there in darkness where they can literally see about a foot in front of them. They are trying to navigate mangled metal, and they’re also in a place [where] it is now presumed that people have lost their lives,” Moore said.
“operations have shifted from a search and rescue operation towards recovery efforts,” said White House press secretary Karine Jean-Pierre in a press conference.
According to the Associated Press, the ship, the Dali, struck the bridge at 1:30 a.m., moments after the vessel’s crew issued a mayday call warning that it had lost power and steering capability. Police officers who were warned that the ship was headed toward the bridge had only about 90 seconds to stop traffic on the interstate highway before the bridge collapsed.
Reportedly, one officer parked sideways across the lanes and planned to drive onto the bridge to alert a construction crew once another officer arrived. However, he did not get the chance as the drifting ship barreled into the bridge.
The accident destroyed a major transportation link in Baltimore, leading to the complete closure of river traffic. This will impact not only the 30,000 daily commuters who use the bridge but also U.S. consumers, who are likely to experience shipping delays.
The Port of Baltimore is a major entry point on the East Coast for vehicles from Germany, Mexico, Japan and the United Kingdom, as well as for coal and farm equipment.
U.S. Transportation Secretary Pete Buttigieg said it is too soon to give a time frame for clearing the channel and resuming normal activities.
“We need the ships to enter and those who were [in the port] to be able to leave,” he stressed.
The vessel, owned by Grace Ocean Private Ltd., a Singapore-based shipping company, was en route from Baltimore to Sri Lanka. Maersk, a Danish shipping giant, had chartered the ship.
The project is expected to be completed in 2026 and to generate 4,500 jobs. (Engie Energy)
Energy company Engie México will invest US $2 billion to build a second gas pipeline in southeastern Mexico, according to a senior executive with the French-owned firm.
Engie is committed to building a new pipeline parallel to the existing Mayakan pipeline that runs between Chiapas and Yucatán. The second pipeline will be shorter, beginning in Tabasco rather than Chiapas, but running to the same final delivery point in Valladolid, Yucatán.
The energy company signed an agreement with CFE earlier this week to “guarantee the transport of natural gas” for the Yucatán peninsula. (Engie Energy)
Ana Ludlow, Engie México’s chief government affairs and sustainability officer, told the news website Bloomberg Línea that the new pipeline will supply gas to two new Federal Electricity Commission (CFE) power plants in Yucatán, one in Mérida and another in Valladolid. The Mérida plant is slated to open in November, while the Valladolid one is scheduled to begin operations in January 2025.
Engie subsidiary Energía Mayakan signed an agreement with the state-owned CFE earlier this week for “the expansion of the Mayakan gas pipeline” in order to “guarantee the transport of natural gas for the generation of electricity required by the Yucatán Peninsula,” according to a company statement.
Ludlow said that construction of the new pipeline will cost approximately $2 billion and that it will be finished by the end of 2026. The money will come from Engie and its partners, Ludlow told Bloomberg Línea without offering further details. She also said that the project will create 4,500 jobs.
According to Engie’s statement, Energía Mayakan will be in charge of the project. It already operates a gas pipeline between a Pemex facility in the municipality of Reforma, Chiapas, and Valladolid.
Map of the second pipeline to be built alongside the existing Mayakan pipeline, which will also have the same final delivery point in Valladolid, Yucatán. (Engie Energy)
The new pipeline will run more than 700 kilometers between Ciudad Pemex in the Tabasco municipality of Macuspana and Valladolid. Ludlow said that the new pipeline will use “practically” the same right of way as the existing pipeline.
The operation of a second pipeline will increase Engie’s capacity to transport gas in southeastern Mexico from 250 million cubic feet per day to 567 million cubic feet, according to the company.
Engie also said that its project will “favor interconnection with the Puerta del Sureste project,” a joint initiative of Canadian company TC Energy and the CFE. The TC Energy project will allow natural gas to be transported from Brownsville, Texas, to Tuxpan and Coatzacoalcos in Veracruz and Paraíso in Tabasco.
Engie said that its project will “trigger economic development,” attract investment to southeastern Mexico and reduce electricity generation costs and the bills of millions of electricity customers in Chiapas, Tabasco, Campeche and Yucatán.
The company said that the operation of the two new CFE plants in Yucatán will avoid the annual emission of 4.6 million tonnes of carbon dioxide.
The supply of natural gas to the plants via the new pipeline will help eliminate the need to use dirtier and more expensive fossil fuels for electricity generation, Ludlow said.
With the Holy Week vacations already in swing, a visitor to Mexico City's Chapultepec Park takes a selfie with a display for the bat festival, which starts March 28. (Mario Jasso/Cuartoscuro)
The Chapultepec Park Festival returns for a third consecutive year this week, and the featured theme will be chiroptera. What’s that, you ask? Chiroptera is the taxonomic classification of the only mammal capable of true flight: the bat.
Mexico City Mayor Martí Batres said he expects upward of 2 million visitors to the festival during its four-day run from March 28 to 31. Chapultepec Park, the 686-hectare woodland area just west of Mexico City’s historic center, will play host to the bat-filled event.
One of the highlights of the festival will be a public talk by Mexico’s internationally known ecologist and bat expert Rodrigo Medellín, who’s been featured in National Geographic and on PBS’ Nature series. (Victoria Valtierra Ruvalcaba/Cuartoscuro)
Playing a key role in promoting this year’s festival is the Bat Man of Mexico, National Autonomous University of Mexico (UNAM) ecologist and bat champion Dr. Rodrigo Medellín.
Medellín, who has been featured in publications like National Geographic and was the subject of a 2021 episode on the PBS series Nature, gained notoriety for his work to preserve the endangered lesser long-nosed bat, also known as the “tequila bat” for its crucial role in pollinating the agave plant, the source of the iconic Mexican liquor.
“Bats are the most important pest control in the world, and Mexico is the country with the fifth-most [number of] bat species in the world,” Medellín said at the March 12 press conference where the festival was announced.
There are 140 million bats in Mexico, Medellín said, and “1 million bats can consume 10 tons of insects each night while dispersing three to five seeds per square meter.”
“Today we have the large forests we have because of bats, which regenerate them,” Medellín said, urging the public to come to the festival and “discover how marvelous bats are.”
Of the world’s 1,400 species of bats, 20 can be found in Mexico City.
Mayor Batres told reporters that there will be more than 100 fixed locales across the first and second sections of the park, as well as cultural, educational, artistic and recreational activities, 200 activities in all. The festival will also feature seven giant papier-machebats — accompanied by workshops and booths — created by artisans from the city’s Iztapalapa borough.
The festival program includes films, concerts, dance and theater performances, plus seminars and conferences by bat experts. On May 28, Dr. Medellín will deliver a talk entitled “Why Take Care of Bats? Our Winged Allies.”
Three large-format photo exhibits installed for the festival will remain open to the public through June.
The organizers claim this year’s Chapultepec Park Festival will be the biggest-ever “bat-themed festival” in the world. There is no entry fee for the festival activities. Tickets for the Museum of Natural History (MHN) — located in the park’s second section — cost 36 pesos.
Migrants negotiate a razor wire barrier as they cross from Ciudad Juárez in Mexico to El Paso, Texas, in the U.S. (Rey R. Jáuregui/Cuartoscuro)
A federal appeals court in the United States issued a ruling on Tuesday that extends the prohibition on the enforcement of a law that allows Texas to detain and deport to Mexico migrants who entered the U.S. between official ports of entry.
A panel of three judges from the 5th U.S. Circuit Court of Appeals voted 2-1 to maintain a ban on the enforcement of the Texas state law known as Senate Bill 4 (SB 4), which was approved by the Republican Party-controlled Texas Legislature last year. The ruling came after a hearing in Louisiana last Wednesday.
The U.S. Supreme Court handed down a decision on March 19 that enabled Texas to enact SB 4, which allows state authorities to arrest people on suspicion of having entered the U.S. illegally and gives local judges the authority to deport migrants to Mexico regardless of their nationality.
However, the application of the law was blocked by the 5th Circuit on appeal later the same day, and no arrests of migrants were reported by Texas authorities during the brief period that it was in effect.
The U.S. government has argued that immigration enforcement is an exclusive power of federal authorities and that application of SB 4 will create chaos at the border with Mexico.
Led by Republican Party Governor Greg Abbott, the Texas government says that federal authorities aren’t doing enough to secure the border and that it has a constitutional right to take its own action to curb the entry of unauthorized migrants into the United States.
The Texas National Guard reinforces barriers at Shelby Park in the border city of Eagle Pass, part of a strategy designed by Texas Governor Greg Abbott and condemned by President López Obrador as a political ploy. (Gov. Greg Abbot/X)
Priscilla Richman, chief judge of the 5th U.S. Circuit Court of Appeals, sided with the U.S. government.
In a written opinion, she said that “for nearly 150 years, the Supreme Court has held that the power to control immigration — the entry, admission, and removal of noncitizens — is exclusively a federal power.”
SB 4 “creates separate, distinct state criminal offenses and related procedures regarding unauthorized entry of noncitizens into Texas from outside the country and their removal,” wrote Richman, who was appointed by former U.S. president George W. Bush.
Judge Irma Carrillo Ramírez, who was appointed by current U.S. President Joe Biden, also voted in favor of blocking the enforcement of the Texas law. Judge Andrew Oldham, who was appointed by ex-president Donald Trump and was a former aide to Abbott, dissented with the majority decision.
Oldham wrote that “in our federal system, the state of Texas is supposed to retain at least some of its sovereignty” and the Texan people “are supposed to be able to use that sovereignty to elect representatives and send them to Austin to debate and enact laws that respond to the exigencies that Texans experience and that Texans want addressed.”
The court’s ruling on Tuesday “will likely prevent enforcement of the law until a final decision on its merits, either by the 5th Circuit or the U.S. Supreme Court,” the Associated Press reported.
Even without the power to enforce SB 4, Abbot — an outspoken critic of U.S. President Joe Biden and his government’s immigration policies — is maintaining a hardline approach to stemming illegal migration into the U.S. with his Operation Lone Star strategy.
Mexico has said it will not cooperate with any efforts by Texas state authorities to deport migrants. (Cuartoscuro)
“Operation Lone Star is working. … Illegal crossings are going down in Texas while at the same time they are skyrocketing in California & Arizona. It’s because of the border wall, razor wire barriers, the National Guard & arrests by DPS [the Texas Department of Public Safety],” he wrote on the X social media platform on Tuesday.
Mexico’s opposition to SB 4
After the Supreme Court ruled last week that Texas could enforce SB 4, the Mexican government said that Mexico would not accept the return of migrants by the Lone Star state “under any circumstances.”
The law “seeks to stop the flow of migrants by criminalizing them, and encouraging the separation of families, discrimination and racial profiling that violate the human rights of the migrant community,” the Ministry of Foreign Affairs (SRE) said in a statement.
Given that Mexico says it won’t accept any migrants deported by Texas, it is unclear what in fact would happen to people expelled from the Lone Star state under SB 4.
President Andrés Manuel López Obrador has called the law “inhumane” and “politically motivated” and denounced a range of other anti-immigration measures enacted by Governor Abbott, including the strict inspection of trucks entering Texas and the installation of floating barriers in the Rio Grande.
A U.S. judge ordered Texas to remove buoys and underwater nets it installed in the Rio Grande due to safety concerns, among other issues. (U.S. Customs and Border Patrol)
López Obrador and other government officials have also staunchly defended the rights of Mexicans and other migrants who live in the United States.
On Tuesday, she noted that in making its latest ruling, the 5th U.S. Circuit Court of Appeals made reference to the amicus curiae (friend of the court) brief filed by Mexico against SB 4.
Bárcena highlighted a section of the ruling that says “there is a high risk that enforcement of SB 4 would cause international friction” and acknowledges that “Mexico has already protested SB 4 and signaled that the statute’s enforcement would frustrate bilateral efforts, including noncitizen removals.”
“Mexico categorically rejects any measure that allows state or local authorities to exercise immigration control, and to arrest and return nationals or foreigners to Mexican territory,” the SRE said last week.
The central mountainous region of Veracruz state is affected by multiple wildfires that began on Saturday and have still not been fully contained. (Carlos Nava/Cuartoscuro)
Six forest fires that began over the weekend in the high mountains of central Veracruz have consumed 1,670 hectares and at least 20 homes in the state as of Wednesday, while the number of active wildfires in Mexico has quickly increased this week.
State authorities have announced that there are active fires in 14 municipalities in Veracruz, which are between 50% and 90% controlled as of early Wednesday.
As of Wednesday, there are 1,000 firefighters working to extinguish the wildfires in the state. (Cuartoscuro)
In Minatitlán, the fires near Pemex’s Lázaro Cárdenas refinery produced a cloud of black smoke observable from various points in southern Veracruz on Tuesday.
The state government also reported a fire had broken out at the Ixtaczoquitlán industrial park on Tuesday morning, which reached the facilities of International Paper. No injuries have been reported and task forces were attending to the incident.
According to Governor Cuitláhuac García, an investigation is underway to determine whether the fire was caused by agricultural burning, a rural practice of burning the soil to prepare it for new planting.
The government of Veracruz has warned that anyone who causes such fires will be punished with one to six years in prison and fines of up to 75,000 pesos (US $4,500).
A Navy helicopter has been brought in to help combat the blazes in Veracruz. (SSP Veracruz/X)
Authorities have faced criticism for their delayed response to the ongoing forest fires at all levels of government since Saturday.
Residents of Orizaba and other municipalities have expressed their willingness to assist authorities and vulnerable populations in addressing the fires in Veracruz’s central region. They have offered water from their cisterns, water tanks and even swimming pools for emergency services to use in fighting the flames.
The intensity of the blazes led to aerial firefighting operations, with a helicopter provided by the Navy (Semar) dropping water discharges at strategic locations.
According to a report from Milenio newspaper, there are over 1,000 firefighters combating the fires from the National Guard (GN), Defense Ministry (Sedena), state Environment Ministry (Sedema) and municipal brigades.
President Andrés Manuel López Obrador told reporters on Wednesday morning that there are currently 116 active fires across the country — 20 in México state alone — up from 95 active fires reported in 18 states by the National Forestry Commission (Conafor) at 11:00 a.m. on Tuesday.
In January, Conafor had warned to expect an increase in wildfires this year as much of the country continues to experience drought conditions.
Glyphosate, often sold under the brand name Roundup, is classified as a "probable carcinogen" by the World Health Organization. (Shutterstock)
Mexico’s government paused its plan to ban glyphosate, a widely used but controversial herbicide, citing concerns about maintaining agricultural productivity and ensuring food security.
The postponement, announced on Tuesday, comes just days before a previously announced April 1 deadline that would have prohibited “purchasing, using, distributing, promoting and importing glyphosate or agrochemicals that contain it as an active ingredient.”
The weed-killing chemical is used mainly in the production of corn, citrus and fruits and is associated with the cultivation of genetically modified organisms (GMO) such as corn, cotton and soybeans. (A common genetic modification makes crops resistant to glyphosate, allowing farmers to apply large amounts of the weed-killer to those GMO crops.)
A joint statement from the Ministries of Economy (SE), Environment and Natural Resources (Semarnat) and Agriculture and Rural Development (Sader), along with the Federal Commission for the Protection against Sanitary Risks (Cofepris), acknowledges the potential health risks of glyphosate, but emphasizes that a suitable alternative has yet to be identified.
The conditions outlined in a 2020 presidential decree for phasing out glyphosate — continued agricultural output, reduced impact from substitution and viable agroecological alternatives — have not been fully met, according to the statement.
The National Council of Science, Humanities and Technology (Conahcyt), tasked with developing alternatives, did not participate in the decision to postpone the ban.
Many GMO crops are designed to be resistant to glyphyosate, a common but controversial herbicide. (Via La Jornada San Luis)
A year ago, the government said that 12 low-toxicity, broad-spectrum alternatives that can maintain productivity for farmers were in the works.
“Seven bioherbicides have been identified that are available worldwide, and five that will be Mexican manufacturing developments,” Sader stated at that time.
However, those options are reportedly not yet available in sufficient quantities or at accessible prices.
The decision to postpone enactment of the decree has been met with support from agricultural organizations who argue that glyphosate is currently irreplaceable due to its effectiveness and affordability.
Eraclio Rodríguez, national coordinator of the National Front for the Rescue of the Countryside, said applying glyphosate costs about 500 pesos per hectare, while a manual alternative such as tillage would cost up to 6,000 pesos per hectare.
The World Health Organization (WHO) has classified glyphosate as a “probable carcinogen,” though the safety of the herbicide remains a subject of debate.
In addition to calling for the elimination of glyphosate, the decree published on Dec. 31, 2020 also called for Mexico to ban the importation of GM corn for use in dough and tortillas, and gradually phase out imports of GM corn for any kind of human consumption by 2024, and for use as animal feed (depending on supply) at an unspecified later date.
The United States is opposed to this plan, and last year it requested the establishment of a panel to resolve the issue.
Moreover, in 2022, the German company Bayer obtained a court order against the application of the decree after Cofepris refused to issue it a permit for a new GMO seed variety it had developed. The decree allowed Bayer, which in 2018 acquired Monsanto, producer of the glyphosate-based herbicide Roundup, to continue supplying glyphosate and GMO seeds to Mexico.
In the mid-twentieth century San Miguel emerged as a center for the study of arts and languages, attracting people from all over the world - thanks to the work of American WWII veterans. (All photos by Memoria San Miguel/Facebook.)
Established in 1542 as a Spanish colonial settlement, San Miguel de Allende flourished during colonial times with significant wealth derived from nearby silver mines. This prosperity fueled the construction of grand mansions, churches, and public buildings that showcased the city’s opulence.
Artists such as Rufino Tamayo, Leonora Carrington and Joy Laville made San Miguel de Allende a center for the arts, putting it on the map as a global creative hub. (Rufino Tamayo).
However, the War of Independence (1810-1821) and the Revolution War (1910-1917) had devastating effects. The cessation of the region’s silver mines, which had been the city’s economic backbone, led to widespread hardship. Social and political turmoil further exacerbated the decline and many residents abandoned their homes in search of better opportunities elsewhere.
The grand architecture fell into disrepair and by the early 1900s, the town teetered on the brink of becoming a ghost town. In 1926, the Mexican government intervened, declaring it a national historic monument. This designation marked a transformative moment, signaling a commitment to revitalizing its significance. With strict regulations in place to protect its colonial ambiance, the town embarked on its renaissance.
Stirling Dickinson is a man who played a most notable role in shaping the modern history of San Miguel de Allende. Born in 1909 in Chicago, he hailed from a prestigious family background. After graduating from Princeton with a degree in art and architecture, he embarked on a six-month tour of Mexico with his classmate Heath Bowman, resulting in their adventure book “Mexican Odyssey,” ranking in at No. 10 in the Chicago Daily Tribune bestsellers list.
Dickinson and Bowman then authored another travel adventure, “Westward from Rio,” before heading to San Miguel de Allende in pursuit of a peaceful setting to work on their next book, “Death Is Incidental” inspired by the Mexican Revolution This journey was prompted by the invitation of Jose Mojica, a Mexican opera singer and Hollywood film star who had built a home for his mother in San Miguel de Allende and welcomed the two Americans to experience the town’s charm.
Dickinson, in his jeep, and other World War II vets put on uniforms and joined Mexico’s Independence Day parade on September 16, 1946. (John Virtue Collection)
Dickinson and Bowman arrived by train in the early morning hours of February 7, 1937, and rode into town on a mule-drawn cart. Reflecting on their arrival, Dickinson vividly recalled, “I looked up and saw the Parroquia sticking up out of the fog, and I said, ‘My gosh, what a place!’ I think I must have decided at that minute I was going to stay here because 10 days later I bought the house I’m sitting in now,” as recounted in a 1992 interview for the San Miguel Archive Project.
In 1938, Dickinson was appointed director of the Escuela Universitaria de Bellas Artes, housed in part of the Immaculate Conception convent that had been confiscated from the church by the government following the Mexican Revolution. However, his work in Mexico was interrupted by World War II. From 1942 to 1945 he returned to the United States to serve in Naval Intelligence and later in the Office of Strategic Services, the precursor to the CIA. Upon his return to San Miguel after the war, Dickinson leveraged his connections to facilitate attendance at the art school on the G.I. Bill that funded free education for war veterans.
Chicago papers and other publications quickly began featuring stories about this emerging artist enclave nestled in the mountains of Mexico, sparking a period of prosperity for both the school and the town. Over 6,000 veterans applied to enroll following the January 1948 issue of Life magazine, which lauded San Miguel de Allende as a “G.I. Paradise where veterans go to study art, live cheaply, and have a good time.”
San Miguel began to script a new chapter in its history, with education and art taking center stage. The arrival of new students and visitors brought an influx of income for local merchants and service providers. This increased prosperity was evident in the construction of hotels, and the city flourished remarkably.
The Escuela Universitaria de Bellas Artes was founded by Peruvian Felipe Cossío del Pomar in 1937. The institute provided San Miguel with a world-class art school. (Juan Guzmán)
Trouble came when a recently arrived member of the faculty, noted Mexican muralist David Alfaro Siqueiros, got into a dispute over funding with the art school’s manager. Siqueiros led a walkout of students and staff with Dickinson’s support.In 1946, the Bellas Artes school was taken over by the Ministry of Education of the State of Guanajuato and now houses the government-run Centro Cultural Ignacio Ramírez.
Felipe Cossío del Pomar, a Peruvian artist and diplomat in exile who had previously established the Instituto de Bellas Artes with encouragement from intellectuals Alfonso Reyes and José Vasconcelos, was resolute about ensuring San Miguel had a top-tier art school. In 1950, he, along with his public relations expert Stirling Dickinson, the former governor of Guanajuato, Enrique Fernández Martínez, and his wife, the American Nell Harris, founded another art school, Instituto Allende.
By 1960, Instituto Allende had become pivotal in drawing new residents to the town, primarily through its acclaimed art education programs. San Miguel’s economy continued to thrive with the influx of tourists and expatriates enticed by the vibrant arts scene, affordable living, and a welcoming international community.
San Miguel de Allende continues to be a beacon for creativity and inspiration with numerous schools and galleries, drawing people from around the world who come to experience its unique charm and contribute to its ongoing legacy.
Sandra Gancz Kahan is a Mexican writer and translator based in San Miguel de Allende who specializes in mental health and humanitarian aid. She believes in the power of language to foster compassion and understanding across cultures. She can be reached at: [email protected]
The United States is Mexico’s biggest export market for automobiles, semiconductors and pharmaceuticals. (Cuartoscuro)
Mexico was once again the world’s seventh largest vehicle manufacturer in 2023, while its annual production growth was the third highest among the top 10, according to data from an international industry group.
Statistics published by the International Organization of Motor Vehicle Manufacturers (OICA) show that vehicle production in Mexico increased 14% in annual terms to just over 4 million in 2023.
Mexico produced just under 3.1 million commercial vehicles and just over 900,000 cars, according to the OICA data, making it the world’s seventh largest vehicle manufacturer for a fourth consecutive year.
In 2023, Mexico ranked behind China, the United States, Japan, India, South Korea and Germany in terms of total output. Spain, Brazil and Thailand rounded out the top 10.
Germany, where 4.11 million vehicles were made last year, and South Korea, which had a total output of 4.24 million units, were only narrowly ahead of Mexico.
Only Germany and Japan recorded larger annual production growth than Mexico among the world’s top 10 vehicle manufacturers. Output increased 18% in Germany in 2023 and 15% in Japan.
In 2023, production of vehicles grew almost 15% over 2022. (Gobierno de México)
Automakers from both those countries as well as the United States and South Korea have plants in Mexico, and several of them have plans to expand their operations here.
Chinese companies such as BYD and Jaecoo intend to establish a manufacturing presence here soon.
OICA data also shows that a total of 93.54 million vehicles were made around the world last year, a 10% increase compared to 2022 and a 1.5% uptick compared to 2019.
Almost one-third of those vehicles were manufactured in China, which had a total output of 30.16 million units last year including 26.1 million cars.
The peso is the strongest it has been since June 5, shortly after Mexican elections. (Cuartoscuro)
The Mexican peso appreciated to its strongest level against the US dollar in more than eight years on Wednesday morning, reaching 16.52 to the greenback.
The last time the peso was stronger was in October 2015, according to a long-range foreign exchange chart on the Yahoo! Finance website.
The peso appreciated around 0.7% against the dollar to reach 16.52 on Wednesday morning after closing at 16.64 on Tuesday.
The currency has appreciated around 1.4% this week, even though the differential between the Bank of Mexico’s benchmark interest rate and that of the United States Federal Reserve narrowed last Friday as a result of a 25-basis-point interest rate cut in Mexico.
The significant difference between the two rates — now 11% in Mexico versus 5.25%-5.5% in the U.S. — has benefited the peso for a prolonged period.
Janneth Quiroz, director of economic analysis at financial group Monex, said on the X social media platform that the peso benefited on Wednesday from the publication of data that showed that “Mexico’s economic activity could remain strong in 2024.”
Mexico’s economic activity is holding strong into 2024 and exports are up over last year. (Cuartoscuro)
She noted that data showed that Mexico’s exports increased 13% in annual terms in February and unemployment fell.
The peso — which appreciated around 13% against the dollar last year — has benefited for an extended period from strong incoming flows of remittances and foreign investment.
Owning a home in Mexico may be a dream for many - but what does it mean for your taxes? (Shutterstock)
According to statistics released by both the U.S. and Mexican governments, record numbers of Americans are moving to Mexico to live and work. And why not? With its rich culture, temperate climate, proximity to the United States and affordable living, relocating to Mexico could be the new American Dream. In the six years that I have lived in San Miguel de Allende, I’ve seen more and more U.S. citizens taking advantage of opportunities to purchase vacation homes, investment properties and places to settle in retirement.
When buying real estate in Mexico however, it’s important to understand the tax consequences of your decision, both in Mexico and the United States.
Americans can own land in Mexico, though you may need to make special arrangements to establish a fideicomiso. (John Tyson/Unsplash)
Can Americans own land in Mexico?
You may have heard that Americans can’t own property in Mexico. That is false. Americans — and any other foreign citizen — can easily and legally purchase property in Mexico directly and hold title in their own name, so long as the property is not in a restricted zone.
A restricted zone, as defined by Article 27 of the Mexican constitution, is an area within 100 kilometers of an international border or within 50 kilometers of the coast. A U.S. citizen can still buy a house or land within a restricted zone, but title to the property has to be held within a Mexican corporation or within a bank trust, called a fideicomiso.
Typically, a house in a restricted zone that is intended to be used as a permanent residence or vacation home, as opposed to a purely business use, is purchased using the fideicomiso model. Although fideicomisos do add some time and cost to the process, once set up, the individual beneficiary — presumably you — can make all the decisions regarding the property: you can build on it, live on it, rent it, sell it or pass it down to friends or family. That also means the tax consequences belong to you as well.
Whether you purchase property directly or through a fideicomiso, keep records of what you pay for the property and the expenses associated with your purchase, including closing costs, fees for real estate agents, attorneys and notaries and taxes or other items that you assume on behalf of the seller. These costs are your basis in the property. Your basis is the amount you invested in the property and it is important for tax purposes because if you sell the property, you can deduct your basis from the sales price to arrive at the taxable gain.
Now that I own the property, what are the U.S. tax consequences?
The taxes owed on your Mexican home will vary depending on whether you use it as a primary residence or a rental property. (Airbnb)
Generally, the same tax rules that apply to U.S. property apply to your property in Mexico. Just like in the U.S., however, the rules depend on whether you use the property as your primary residence, as a vacation home, solely as a rental, or in some combination of these ways.
If you use your foreign home as your primary residence — i.e., you spend the majority of your time there — or as a vacation home, you can deduct mortgage interest. The amount that you can deduct depends on whether the loan was made before or after Dec. 16, 2017. See IRS Publication 936, “Home Mortgage Interest Deduction,” for more information. Report your mortgage interest deduction for a foreign home on Schedule A, Itemized Deductions, in the same way that you would deduct mortgage interest on a qualified home in the U.S..
If the lender is a foreign person, including a foreign bank, it most likely will not provide you or the IRS with a Form 1098, Mortgage Interest Statement, which totals the amount of interest you paid during the year. If you don’t receive a Form 1098, you can still deduct the mortgage interest on Schedule A, but you should attach a statement to your tax return explaining to whom you paid the interest. Keep detailed records of your payments for at least three years in case the IRS requests evidence.
You can’t deduct costs for utilities, minor maintenance, homeowners association fees, security or similar expenses if you use your foreign home as your primary residence. These are considered personal expenses and the same prohibitions on deduction apply to U.S. residences. However, if you operate a business from the home and are able to claim the home office deduction, these expenses may offset self-employment income on Schedule C, Profit or Loss from Business. For a full explanation of tax deductions for your home office, see Publication 587, “Business Use of Your Home.”
The deduction for foreign real estate taxes is scheduled to return in 2026. (Kelly Sikkema/Unsplash)
Currently, the significant difference with foreign property as compared to a home located in the U.S. is that you cannot deduct foreign real estate taxes in years 2018 through 2025. The deduction for foreign real estate taxes is scheduled to return in 2026.
Your foreign home as a rental property
Owning a foreign rental property is the ultimate dream for many Americans. However, rental income from a foreign property must be included on your U.S. tax return using Schedule E, Supplemental Income and Loss. The good news is that you can deduct more expenses when you use your property as a rental than you can when you use it only for personal use.
Rental deductions include those expenses such as mortgage interest and insurance premiums that you can deduct on Schedule A when you use your property as a home. But they also include things that you can’t deduct when you use your house as a home. These can include repair and maintenance costs that keep the property in an efficient operating condition, such as painting a room or house cleaning between tenants.
Generally, small improvements such as these are categorized as general maintenance and do not increase your basis. Expenses for improvements to the property, such as new construction, replacement of windows and other projects that add value to the property must be added to your basis rather than currently deducted. Publication 527, “Residential Rental Property,” has tables listing deductible expenses as compared to improvements.
Rental income from a foreign property must be included on your U.S. tax return using Schedule E. (Dimitri Karastelev/Unsplash)
Deductions can also include outlays such as advertising costs, management fees and travel expenses incurred to manage or maintain the rental property. Whether you can deduct some or all of your travel costs depends upon how much of your trip is related to the business of the rental versus personal reasons. If the purpose of your trip is part business and part personal, an allocation of expenses is required. See IRS Publication 463, “Travel, Gift, and Car Expenses,” for an explanation of the rules and examples.
Do I have to report all of my rental income?
Generally yes, but an exception does exist. If you rent your foreign house for 14 days or less and use the property as a home, you do not have to report its rental income to the IRS. In this case, however, your deductions would continue to fall into the category for personal use of your foreign home described above.
For this purpose, the IRS considers a property a home — as opposed to a rental — if your personal use was the greater of:
14 or more days during the year, or
10% of the total days it was rented to others at a fair rental price.
An example can help illustrate how to apply the 14-day or 10-percent rule.
Mary owns a condo in Puerto Vallarta. In 2023, she rented the unit at a fair rental price for 280 days. She also used it for a 10-day vacation with her family and allowed her brother to use it for 10 days, rent-free, on a separate occasion. Allowing a family member or friend to use the unit without paying rent counts as Mary’s personal use. Incidentally, the IRS also considers it a day of personal use if you allow someone to use the house under an arrangement that lets you use some other dwelling unit, such as in a home exchange.
Even though Mary used the condo in a personal capacity for more than 14 days, she is not considered to have used it as a home because ten percent of the days it was rented is greater than 14 days — 10% of 280 days equals 28 days. Mary’s case thus falls under the 10% rule rather than the 14-day rule. Since she used the house in a personal capacity for only 20 days, she is not considered to have used it as a home.
In this case, Mary is required to report the rental income and she can deduct her expenses in maintaining the house. However, because she used the house in a personal capacity, the expenses need to be allocated between personal and rental. Publication 527, “Residential Rental Property,” explains how to report income and expenses in this situation.
Selling your foreign home
The rules for sale of a foreign property are similar to those for selling a home in the U.S. If you lived in the home as your primary residence for two out of the previous five years, you can exclude a portion of the gain from U.S. tax. In 2023, the amount of gain a married couple can exclude from the sale of their principal residence is US $500,000; for a single person, the exclusion is $250,000. If you don’t meet the two-in-five-year rule, or if your gain exceeds the amount you can exclude, you will owe capital gains tax on the profit.
If you rent your foreign house for 14 days or less and use the property as a home, you do not have to report its rental income to the IRS. (Kelly Sikkema/Unsplash)
This situation demonstrates the importance of keeping track of your original cost and improvements that increase your investment basis in the property. The higher your basis, the less gain you have when the property is sold.
If you are married and your gain is less than $500,000, you would pay no tax. If you don’t meet the rule, or if your gain exceeds the exclusion amount, you can still benefit by keeping good records regarding your basis. For example, if you purchase a house for $320,000 and invest $1,500 building a rooftop terraceand another $3,000 installing a pool, these costs would increase your basis from $320,000 to $324,500.
While adding such a small amount to your capital investment in the property doesn’t seem like much, if you assume a 15% capital gains tax rate, increasing your basis $4,500 would save you $675.
In Mexico, that can go a long way.
One More Thing – Foreign Bank Account Reporting
The U.S. requires citizens who have a financial interest in or signature authority over a foreign financial account that exceeds $10,000 at any time during the calendar year to file a Report of Foreign Bank and Financial Accounts, commonly referred to as the FBAR.
You’ll be happy to know that real estate owned directly by an individual or within a fideicoimso is excluded from FBAR reporting. This is true regardless of whether you use the foreign residence as a home or as a rental property. That’s good news.
Paul Carlino is an attorney living in San Miguel de Allende and the founder of Pickleball Mexico. He writes for Mexico News Daily.
