From Baja California to Buena Vista, Mexico and the United States have clashed military many times. We've collected some of the most notable stories. (White House Historical Archives)
While recent relations between Mexico and the United States have (for the most part) been cordial in recent years, the two countries have more than a century long history of discord.
In the 1800s, Baja California faced more than storms and pirates — it faced would‑be conquerors armed with cannons, foreign flags and expansionist ambitions. French aristocrats, U.S. adventurers like William Walker and influential border businessmen who sought to claim the peninsula for profit, slavery and personal glory. Chris Sands highlights the Mexican generals, ranchers and communities whose resistance ensured that Baja California remained Mexican territory.
How Mexico lost more than half its land to the U.S.
One treaty permanently redrew the map of North America — and left deep scars that still shape U.S.–Mexico relations today. War, broken promises and land grabs forged a shared but uneasy history that remains painfully relevant. Monserrat Castro revisits the 1848 Treaty of Guadalupe Hidalgo, which cost Mexico 55% of its territory, upended the lives of 80,000 Mexican residents and fueled the road to the U.S. Civil War.
In 1914, a brief arrest of nine U.S. sailors in Tampico spiraled into a full‑scale U.S. invasion of Veracruz, while Mexico was already engulfed in revolution. Leigh Thelmadatter retells the Tampico Affair from the Mexican side: Wilson’s gambit to topple Huerta, civilian resistance, and a bloody occupation that left 500 Mexicans dead and deepened anti‑U.S. sentiment across the country.
In Mexico, six cadets known as the Niños Héroes are honored as martyrs who died defending Chapultepec Castle from U.S. troops in 1847, wrapped in the flag rather than surrender. Oxford University’s Shyal Bhandari writes exclusively for Mexico News Daily and asks how much of that story is history and how much is myth, tracing missing records, conflicting accounts and an Indigenous officer whose sacrifice may have been erased.
90 years ago, almost 2 million Mexicans were deported en masse
Nearly a century before today’s mass‑deportation efforts, the United States already removed 1.8 million Mexicans at the height of the Great Depression. This deeply reported piece revisits Herbert Hoover’s 1930s “American jobs for real Americans” campaign, saw deportations without due process, condemning many U.S. citizens to removal. From park raids and hospital round‑ups to California’s modern apology, Sheryl Losser reveals a history many prefer to forget but which echoes ominously into the present.
On a windswept stretch of Tamaulipas sand, beachgoers suddenly found signs warning they were on U.S. Department of Defense property and could be detained and searched. After the Mexican Navy tore down six unauthorized signs on Playa Bagdad, Washington said contractors “made a mistake.” Why does this episode hit a nerve when talk of unilateral U.S. military action in Mexico grows louder?
Mexico is a land of color, contrast, warmth and joy — in stark opposition to the sepia-tinted badlands that some U.S. politicians portray it as. (Anna Bruce)
If you’ve spent time in Mexico, you’ve likely felt a familiar mix of fascination, frustration, and affection for a country that’s magnetic and vividly alive. For Americans who know Mexico primarily through headlines, however, it can appear almost unrecognisable: a nation portrayed as unstable and chiefly responsible for a host of U.S. problems.
That portrayal closely mirrors the rhetoric of U.S. President Donald Trump. Across speeches, social media posts, and televised interviews, Mexico is often cast as a country willfully flooding the United States with drugs and failing to control migration. In a Fox News interview on Saturday, January 3, following recent events in Venezuela, Trump even hinted at the possibility of conflict much closer to home.
There is a lot more to life in Mexico than surface level political rhetoric, as anyone who has spent time in the country is well aware. (Gerson Repreza/Unsplash)
“Your vice president, JD Vance, said that the message is pretty clear: that drug trafficking must stop. So was this operation a message that you’re sending to Mexico, to Claudia Sheinbaum, the president there?” Fox’s Griff Jenkins asked.
“Well, it wasn’t meant to be, we’re very friendly with her, she’s a good woman,” Trump began. “But the cartels are running Mexico. She’s not running Mexico. We could be politically correct and be nice and say, ‘Oh, yes, she is.’ No, no. She’s very, you know, she’s very frightened of the cartels. They’re running Mexico. And I’ve asked her numerous times, ‘Would you like us to take out the cartels?’ Something is gonna have to be done with Mexico.”
Trump’s language frames Mexico less as a neighbour or partner and more as a looming threat. For those who’ve never travelled south of the border, this one-dimensional depiction can easily become the dominant lens through which the country is viewed.
The reality, however, is far more intricate.
Misrepresented blame
One of Trump’s most frequent claims is that Mexico is deliberately flooding the United States with fentanyl, leading to hundreds of thousands of deaths. While the CDC confirms the opioid crisis has indeed resulted in more than 100,000 overdose fatalities annually in the U.S., attributing this tragedy solely to Mexico oversimplifies a deeply complex issue.
Fentanyl does cross into the U.S. from Mexico, but through criminal networks, not as a matter of government policy or national strategy. Drugs are most often smuggled through legal ports of entry, frequently by U.S. citizens, using increasingly sophisticated methods. Mexican authorities actively work to disrupt these networks, often at considerable risk and cost.
Mexico is now responsible for a quarter of global fentanyl seizures, as the country is making inroads into the trafficking trade. (Semar/Cuartoscuro)
Trump’s framing isn’t only misleading, it shifts responsibility away from U.S. demand, domestic trafficking networks, and the public-health dimensions of addiction. Drug trafficking is a shared challenge, and rhetoric that ignores this reality strains cooperation on both sides of the border.
The reality of enforcement
Trump has argued that Mexico does little to control migration and that declines in border crossings are solely the result of his policies. This narrative omits key facts.
Mexico enforces its immigration laws rigorously, often under extraordinary strain. Data from the Migration Policy Institute documents checkpoints, detention centres, deportations, and patrols along Mexico’s northern border, many operating with limited resources and constant scrutiny.
Reducing this reality to slogans about walls and tariffs overlooks the complexity on the ground. Mexico isn’t passively allowing migration, it’s managing a regional humanitarian crisis in real time, while absorbing pressures that never reach U.S. headlines. This effort, while imperfect, reflects the work of countless officials and citizens navigating difficult circumstances.
Exaggerating the threat
At its core, Mexico is a vibrant, laid back culture, a world away from the cartel hellscape that U.S. politicians paint it as. (Magdalena Montiel/Cuartoscuro)
Trump often describes Mexico as a cartel-run state where danger is omnipresent. While violence certainly exists, it’s uneven and highly localized. Data from Mexico’s National Institute of Statistics and Geography shows that large areas of the country, including Mérida, Querétaro, Oaxaca, and most neighbourhoods of Mexico City, remain notably safe.
In these places, daily life looks much as it does elsewhere. People walk through parks, shop in markets, and sit in cafés without the constant fear implied by Trump’s portrayal.
Distorted narrative
Trump has repeatedly claimed that Mexico doesn’t cooperate enough with the U.S. in terms of extraditions. This assertion is demonstrably false and is supported by U.S. Department of Justice data that highlights Mexico’s long history of extraditing criminals to the U.S., often under significant political pressure and real danger to the officials involved.
Cooperation between the two countries extends well beyond law enforcement. Extraditions involve complex legal and diplomatic considerations and mischaracterising this history undermines trust while fueling unnecessary suspicion.
An oversimplification
Throughout 2025, Trump maintained that walls and tariffs could single-handedly resolve border issues. In reality, migration and trade are shaped by deep-rooted forces including inequality, violence, labour demand, and global supply chains. Treating these challenges as problems with simple, mechanical solutions obscures their true nature.
Trade deficits, which Trump frequently cites as evidence that Mexico is exploiting the U.S., are similarly complex. They reflect consumer behaviour and market dynamics, not wrongdoing. Tariffs, moreover, are paid by U.S. importers, costs that ultimately land on American businesses and consumers, not on Mexico.
Inflated numbers
Trump routinely inflates figures related to illegal crossings, drug deaths, and cartel activity. These exaggerations fuel anxiety and suspicion among audiences watching from afar. For those of us living in Mexico, they more often provoke frustration and disbelief.
Scenes like this do exist, but they’re much fewer and further between than some people might be quick to claim. (Keith Dannemiller/IOM)
Day to day Mexico is vibrant, functional, and resilient. The lesson isn’t to dismiss data, but to approach dramatic claims with scepticism and to balance statistics with lived experience.
Residents here often navigate between two competing narratives: the Mexico we know, and the Mexico portrayed in political theatre. That distinction shapes how we live, where we settle, and how we explain our lives to friends and family back home. It reminds us that Mexico isn’t a monolith defined by danger, but a country of nuance, contradiction, and endurance.
Beyond fear driven narratives
Trump’s narrative about Mexico reflects a broader pattern of exaggeration and blame-shifting. For those relocating to or already living in Mexico, the takeaway is simple: the country is richer, more vibrant, and more complex than any Trump headline or speech suggests. Bureaucracy can be frustrating, crime exists, and governance can feel bewildering at times, but daily life goes on. Families gather, businesses grow, markets buzz, and communities support one another.
Rhetoric has consequences. Words spoken from a political stage shape perceptions, influence policy, and colour everyday interactions. Statements like “Something is gonna have to happen to Mexico” carry weight well beyond the moment they’re uttered.
Charlotte Smith is a writer and journalist based in Mexico. Her work focuses on travel, politics, and community.
Protesters gathered Saturday in Mexico City at the Venezuelan Embassy (pictured) and the United States Embassy following news of the U.S. military strike on Venezuela. (Gustavo Alberto / Cuartoscuro.com)
President Trump won in part on a platform in which he promised to take decisive action against drug traffickers, drug cartels and those nations harboring them. Let’s set aside any cynicism on the “real motives” of the Venezuela attack (yes oil, I mean you) and assume that a key objective was to take action on the production and distribution of drugs from Venezuela to the United States and other countries around the world.
What began as a small drug boat getting blown up on Sept. 1 off the Caribbean coast of Venezuela had quickly turned into a steady flow of attacks in both the Caribbean and Pacific. The most recent account is that there have been 36 vessels attacked, with at least 115 people killed. In addition to the boat attacks, there has of course been the U.S. military buildup in the area around Venezuela. Never in recent history have so many U.S. soldiers and military assets been stationed in the region.
Throughout this period, the rhetoric on Mexico has been relatively consistent. President Sheinbaum has continued to emphasize the sovereignty of Mexico and insist that U.S. troops are not acceptable in the country. She recently even went so far as to say that, “The last time the United States came to Mexico with an intervention, they took half of the territory.” President Trump has been consistent in his rhetoric towards Mexico, on more than one occasion insisting that “Mexico is run by the cartels,” while at the same time praising the Sheinbaum administration for the collaboration with the U.S. against the cartels.
Sheinbaum in fact has taken some significant actions against the cartels, and has demonstrated a step change in action compared to her predecessor. AMLO’s “hugs, not bullets” strategy against the cartels clearly was ineffective and insincere. No one can forget AMLO briefly meeting Chapo’s mother in Sinaloa.
But today, everything changed. Sheinbaum’s immediate reaction to the Venezuelan attack was to issue a statement “condemning the military intervention in Venezuela” and citing Article 2, paragraph 4 of the United Nations Charter that reads: “All Members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any state, or in any other manner inconsistent with the Purposes of the United Nations.” That is a logical and valid reaction, especially given her consistent references to Mexico’s sovereignty.
That being said, the United Nations stood by and did little over the past several decades as first Chávez and then Maduro ruled Venezuela with an iron fist. Corruption was rampant, elections were rigged, and millions of Venezuelans were forced to flee the country in search of a better life. The United Nations and most nations of the world stood silent as millions of Venezuelans were forced to walk through the Darien Gap, as countless stories were told of many of them being robbed, raped or killed in the journey. The millions that ultimately made it to the U.S. border were treated as asylum seekers and welcomed into the country. This led to many communities across the nation having their schools, hospitals, and support organizations overwhelmed as they attempted to support the massive wave of new immigrants into the country. This of course was another key theme of the recent U.S. elections.
El Artículo 2, párrafo 4 de la Carta de las Naciones Unidas dice textualmente:
“Los Miembros de la Organización, en sus relaciones internacionales, se abstendrán de recurrir a la amenaza o al uso de la fuerza contra la integridad territorial o la independencia política de…
So the Trump administration finally took action. And in taking action, also said that Mexico, along with Cuba and Colombia could be next. He also once again reiterated to Fox News that Mexico is run by the drug cartels and added that, “Something’s going to have to be done with Mexico.” Is this a threat that should be taken seriously? And if so, what should Mexico do?
Here is my personal take. Not only President Trump, but also Secretary Rubio, U.S. Ambassador to Mexico Ron Johnson and even Secretary Noem have recently commented on the cooperation and collaboration of the Sheinbaum administration in the war on drugs. Clearly this is a completely different tone than what was being said about Venezuela, Cuba and Colombia. The Trump administration has ratcheted up the pressure on Mexico to take action on the cartels, and Mexico has many examples of improved action and results.
I believe that today’s Venezuelan actions will serve as an even larger “stick” to get Mexico to do more, much faster. I also believe that Trump will also use the “carrot” of the upcoming USMCA trade agreement renewal to exert even more pressure on Mexico to quickly produce results. It cannot be forgotten that the U.S. is Mexico’s largest customer, and Mexico is the U.S.’s largest customer. That means alot and obviously isn’t the case with Venezuela, Cuba and Colombia.
What do these results ultimately look like? Look for more cartel leader arrests, more drug seizures, more collaboration on the flow of money, weapons and drugs. And look for the use of drone strikes on Mexican fentanyl labs. This was my “wildcard” prediction for Mexico for 2026 that I think just became a lot more likely today. The drone strikes might be ultimately conducted by Mexico (with behind the scenes support from the U.S. military), but I do believe that they will begin happening sooner rather than later.
I believe that these actions by Mexico will happen, and as a result will prevent any direct U.S. actions or intervention in Mexico. The real question to begin to think about, both in Venezuela and if increased actions take place in Mexico, is what will happen next. In other words, what will the cartels do next? Where will they go? How will they respond? History teaches us that it is not the success of the attack, but rather the lack of a plan after the attack, that often ultimately determines future success. Let’s hope that the U.S. has a comprehensive, well-thought-out plan to address that.
Travis Bembenek is the CEO ofMexico News Daily and has been living, working or playing in Mexico for nearly 30 years.
Sheinbaum had said on repeated occasions that Mexico was opposed to U.S. military action in Venezuela. (Galo Cañas/Cuartoscuro/Wikimedia Commons)
The Mexican government on Saturday issued a statement expressing its condemnation of the United States’ military actions in Venezuela, where President Nicolás Maduro and his wife Cilia Flores were captured by U.S. forces before being flown to the USS Iwo Jima naval vessel in the Caribbean Sea prior to their transfer to New York to face criminal charges.
“The government of Mexico vigorously condemns and rejects the military actions carried out unilaterally in recent hours by the armed forces of the United States of America against targets in the territory of the Bolivarian Republic of Venezuela,” says the statement issued by the Ministry of Foreign Affairs (SRE) and shared on social media by President Claudia Sheinbaum.
El Artículo 2, párrafo 4 de la Carta de las Naciones Unidas dice textualmente:
“Los Miembros de la Organización, en sus relaciones internacionales, se abstendrán de recurrir a la amenaza o al uso de la fuerza contra la integridad territorial o la independencia política de…
The statement adds that the U.S. actions — which included strikes in and around the Venezuelan capital of Caracas — were “in clear violation of article 2 of the Charter of the United Nations.”
In her social media post, Sheinbaum pointed to the fourth paragraph of Article 2 of the UN Charter, which states that “all [UN] Members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any state.”
“Based on its foreign policy principles and its pacifist vocation, Mexico makes an urgent call to respect international law, as well as the principles and purposes of the UN Charter, and to cease any acts of aggression against the Venezuelan government and people. Latin America and the Caribbean is an area of peace, built on the basis of mutual respect, the peaceful settlement of disputes, and the prohibition of the use and threat of force. Therefore, any military action poses a serious risk to regional stability.”
The Mexican government also asserted that “dialogue and negotiation are the only legitimate and effective means to resolve existing differences” and consequently reaffirmed its “willingness to support any effort aimed at facilitating dialogue, mediation, or accompaniment that contributes to preserving regional peace and avoiding confrontation.”
In addition, it urged the UN to “act immediately to contribute to the deescalation of tensions and facilitate dialogue and create conditions that allow for a peaceful and sustainable solution in accordance with international law.”
Trump: ‘Something’s going to have to be done with Mexico’
U.S. President Donald Trump wrote on Truth Social in the early hours of Saturday that the United States had “successfully carried out a large-scale strike against Venezuela and its leader, President Nicolás Maduro, who has been, along with his wife, captured and flown out of the Country.”
🔴“Algo habrá que hacer con México”, dice Donald Trump, tras la captura de Nicolás Maduro y ataques a Venezuela
En entrevista con Fox News, el presidente de Estados Unidos aseguró que los cárteles gobiernan México.
The attack on Venezuela came after the U.S. military carried out strikes in recent months on numerous alleged drug boats from the South American nation, where Maduro assumed the presidency after the death of Hugo Chávez in 2013.
He described Sheinbaum as “a good woman,” but asserted — and not for the first time — that “the cartels are running Mexico.”
“She’s not running Mexico, the cartels are running Mexico,” Trump said.
“… [Sheinbaum’s] very frightened of the cartels, they’re running Mexico, and I’ve asked her numerous times, ‘would you like us to take out the cartels?’ [and she says] ‘No, no, no, Mr. President, no, no, no please,'” he said.
“So we have to do something,” Trump said before speaking about people who have died in the United States from overdoses after taking drugs that “mostly” enter the U.S. from Mexico.
“They come in from the southern border and something’s going to have to be done with Mexico,” said the U.S. president, who told a press conference on Saturday that the U.S. would “run” Venezuela until a proper transition of power could take place.
Hundreds gathered in front of the United States Embassy in Mexico City on Saturday morning to protest U.S. intervention in Latin America. (Gustavo Alberto/Cuartoscuro)
Sheinbaum has said on repeated occasions that her government is willing to collaborate with its U.S. counterpart on security matters, but would never accept any violation of its sovereignty.
A violation of Mexico’s sovereignty would occur if the U.S. military were to unilaterally carry out a strike on a cartel target within Mexico or deploy troops south of the border to combat Mexican criminal groups that the Trump administration has designated as FTOs, such as the Sinaloa Cartel and the Jalisco New Generation Cartel.
By Mexico News Daily chief staff writer Peter Davies (peter.davies@mexiconewsdaily.com)
The question, of course, is what that “something” means. A mobilization like the one he boasted about in Venezuela? A military strike disguised as humanitarian aid? In geopolitics, answers are never simple, but several factors suggest such a U.S.-led operation would be not only ineffective but dangerously misguided.
The United States’ strike on Venezuela, and extraordinary rendition of President Nicolás Maduro took place in a landscape very different to that of Mexico. (X)
Balkanization
Cartels function everywhere in Mexico, but their activities vary. Along the borders, they once specialized in human smuggling — a business reshaped, though not erased, by Trump’s immigration crackdowns. In Puebla, they steal. In Mexico City, they extort. Their operations reach deep into daily life, adapting like a shadow economy that feeds on absence and fear.
The popular image of gleaming narcos with gold chains and pet tigers misses the truth. These are not caricatures; they are corporations. They run logistics networks that operate with the efficiency of global retailers. The difference is that Walmart files taxes; cartels file body counts.
And when you remove cartel leaders, you don’t end the organization. The fall of El Chapo divided the Sinaloa cartel into rival factions, as his sons, Los Chapitos, battled his old partner Ismael “El Mayo” Zambada for control. Violence surged. New cells formed. “Kingpin strategy” is not a decapitation, but instead a fragmentation of the problem into even harder to remove pieces. Each head cut off becomes a new command structure, smaller, quicker, and often more violent.
Something is already being done
Let’s not pretend Mexico and the U.S. operate in isolation. DEA agents and American intelligence personnel have worked in Mexico for decades. Bilateral operations against cartels are routine; intelligence is shared, coordinated, and, often, successful.
Mexican law enforcment has been seizing and destroying increasing amounts of illicit drugs in recent years. (Gabriela Pérez Montiel/Cuartoscuro)
If what Trump imagines is Marines parading through Mexican streets, that’s not cooperation. It’s an invasion. President Sheinbaum is right: that would be a direct violation of Mexican sovereignty. Mexico is not a failed state begging for rescue; it’s a struggling democracy managing one of the harshest criminal ecosystems on the planet, one fed by its neighbour, often with limited tools and too little support.
Believing that killing cartel leaders will end drug addiction is delusional. The only way to deal with the problem seriously is to treat addiction as the public health crisis it is. Switzerland learned that decades ago. Instead of declaring war on heroin in the 1980s, the Swiss government created supervised heroin and methadone programs so addicts could transition safely toward recovery. Infection rates dropped, overdose deaths plummeted, and drug-related crime fell. The state, not the streets, took control.
Mexico has destroyed countless synthetic drug labs, but the results are temporary at best. When one operation disappears, another one appears elsewhere. As long as the U.S. appetite for narcotics endures, Mexico’s cartels will adapt, relocate, and rebuild.
In essence, legalization removes control from the hands of the criminal underworld and places it squarely with institutions. It doesn’t celebrate drug use, it sets boundaries around it—with rules about who can sell, who can buy, and where consumption can happen. Legalization doesn’t mean permissiveness; it means precision.
Legalized dispensaries in the United States and Canada have undermined the once powerful illicit marijuana trade. (Sophie Nieto-Munoz/New Jersey Monitor)
“Something has to be done”
On this point, Trump isn’t alone. Mexicans are equally desperate. We are tired of the headlines, the funerals and the fear. Our parents remember another Mexico, one where you could travel at night without locking your doors. My generation remembers the warning signs: don’t drive certain highways, don’t look at strangers too long, don’t ask who lives next door.
Of course, we want the violence to stop. But we also know what happens when foreign troops step in under the pretext of restoration. They rarely leave when the fighting’s over. Once a Marine garrison appears in Chiapas or Sinaloa, sovereignty becomes a negotiation, not a right.
Intervention promises quick relief but often ends in permanent instability. The “war on terror” taught us that lesson painfully well.
A final thought
Drugs are already here. The question is who decides their terms — cartels or governments. Prohibition has failed for half a century; legalization, for all its risks, at least offers the chance to manage the damage instead of multiplying it.
Something does have to be done about Mexico — about the violence, about the fear, about the hypocrisy on both sides of the border. But the solution won’t come from cruise missiles or foreign boots on Mexican soil. It will come when both countries can admit that the drug war, as we’ve waged it, has been an act of self-deception.
As Mexicans, we’ve lived with this crisis for far too long and perhaps we’ve also been shortsighted about how to confront it. We’ve demanded action, yet often repeated the same failed formulas. Maybe the real challenge is daring to do something different — and finally breaking free from the cycle that keeps us trapped between fear and denial.
Maria Meléndez writes for Mexico News Daily in Mexico City.
President Claudia Sheinbaum traveled to Oaxaca Monday afternoon, immediately after her daily press conference, to meet with victims' families. (Carolina Jiménez Mariscal/Cuartoscuro)
Mexico’s final week of 2025 began with devastating loss as a train derailment claimed 13 lives Sunday morning, prompting President Claudia Sheinbaum to travel to Oaxaca Monday afternoon, immediately after her mañanera, to meet with victims’ families.
The tragedy cast a somber shadow over the year’s end, even as Sheinbaum delivered her New Year’s message emphasizing unity and progress.
Didn’t have time to read this week’s top stories? Here’s what you missed.
Fatal interoceanic train derailment
The week’s most tragic story unfolded Sunday morning when the Interoceanic Train derailed near Nizanda, Oaxaca, approximately 85 kilometers north of its destination in the port city of Salina Cruz. The accident killed at least 13 people and injured more than 100 of the 250 passengers and crew aboard the two-locomotive, four-carriage train.
The derailment occurred on a curved section of track at the edge of a ravine. While the two locomotives avoided falling down the embankment, the first passenger car detached and slid approximately 6.5 meters down the slope. The second car was left partially suspended in mid-air, while the third and fourth cars came to rest crosswise over the tracks but remained undamaged.
President Claudia Sheinbaum immediately dispatched Navy Minister Admiral Raymundo Morales to the scene and mobilized medical teams. On Wednesday, the president announced plans to seek international certification to improve railway safety, stating that once investigators submit their report, a certifying body should recommend improvements to ensure the track and locomotives are in proper working order.
The accident has increased pressure on Sheinbaum over the safety of recent government megaprojects. Investigative journalist Alejandra Crail reported that Mexico’s federal auditing agency had cited concerns during the train’s construction phase about steep slopes, curves and undulations in the mountainous terrain, as well as questions about contractors’ technical capacity. This marks the third train accident in Mexico this year, following one derailment on the Maya Train in Yucatán and another in Quintana Roo, though neither resulted in serious injuries.
Market performance defies economic headwinds
Despite ongoing struggles in Mexico’s macroeconomy, the nation’s financial markets closed 2025 with remarkable strength.
Mexican stocks outperformed Wall Street, with the iShares Mexico ETF rising over 50% — its highest increase since 1999, significantly exceeding major U.S. benchmarks. Mining and materials companies particularly benefited, with Industrias Peñoles surging more than 260% and Gentera climbing over 100%.
The peso’s performance proved equally impressive. Mexico’s currency strengthened nearly 14% against the U.S. dollar in 2025, marking its best year since before 1994, when the country established its current free-floating exchange rate regime.
The peso closed around 18 per dollar and ranked as the sixth-best-performing major currency globally. The Bank of Mexico’s interest rate cuts — reducing rates by 300 basis points to 7% — helped inject cash into the economy while maintaining investor confidence, alongside structural factors like nearshoring and export resilience.
Mexico’s tourism engine full steam ahead into 2026
Mexico’s tourism industry demonstrated impressive momentum as the year closed, with the country expecting nearly 5 million tourists during the 2025-2026 year-end holidays between Dec. 20 and Jan. 11. This represents a 5% increase over the previous season, with national hotel occupancy rates reaching 56.6% and some destinations exceeding 80%. Tourism Minister Josefina Rodríguez Zamora emphasized that the sector’s strong performance underscores tourism’s role as a vital engine for Mexican families’ well-being.
Felipe Ángeles International Airport moved more than 7 million passengers in 2025, a 12% jump over 2024, bringing the Mexico City area’s second international airport to 17 million passengers served since operations began in March 2022. AIFA’s Master Development Plan projects serving 9 million passengers by 2026, with the FIFA World Cup expected to drive significant additional traffic.
The airport faced challenges during the year, including cancellation of 11 international routes by the U.S. Department of Transportation, eliminating approximately 84,000 passengers. President Sheinbaum has committed to recovering these routes in 2026. The long-awaited Lechería-AIFA train connection remains on schedule to open by late March, just in time for Holy Week travel.
Meanwhile, Cancún will welcome 17 new international flight routes for 2026, connecting Mexico’s Caribbean coast to 11 U.S. cities, five Canadian cities and Dublin, Ireland — marking the first non-stop flight between Cancún and Ireland. Additional domestic connectivity came through Viva Aerobus’s new Saltillo-Cancún route launching in March.
New trade barriers take effect
The new year brought sweeping tariff increases on imports from China and other countries without free trade agreements with Mexico. The measures, effective Jan. 1, affect 1,463 product categories across sectors, including automotive, textiles, steel, plastics and electronics. New duties range from 5% to 50%, with the highest rates on vehicles from China and certain Asian nations.
The policy aims to safeguard approximately 350,000 jobs and advance “sovereign, sustainable and inclusive reindustrialization” under Plan México, President Sheinbaum’s strategy targeting a 15% increase in domestic content and 1.5 million new jobs. The government estimates the tariffs will generate 70 billion pesos in annual revenue. Chinese cars, including electric vehicles from manufacturers like BYD, previously faced 20% duties; the new 50% tariff has been welcomed by Mexican auto industry leaders. Critics warn the measures could increase consumer prices and hurt small businesses relying on imported inputs.
Earthquake rocks capital on second day of the year
Mexico City residents barely had time to ring in the new year before a magnitude 6.5 earthquake struck Friday morning at 7:58 a.m., triggering the capital’s seismic alarm and sending people into the streets. The epicenter was located 15 kilometers south of San Marcos, Guerrero, at a depth of 5 kilometers, and was especially strong in Acapulco, where residents reported intense shaking lasting 30 seconds.
As of midday Friday, authorities confirmed one death — a man who fell while rushing down stairs — with 12 people injured. Mexico City Mayor Clara Brugada reported five downed poles and four fallen trees, with power outages affecting multiple boroughs.
A small electrical substation fire was quickly contained with no injuries. The National Seismological Service recorded 273 aftershocks by 10 a.m., with the largest at magnitude 4.2. Both President Sheinbaum and Mayor Brugada confirmed no serious structural damage in the capital, while Benito Juárez International Airport (MEX) reported normal operations.
Looking ahead
As Mexico moves into 2026, the nation faces great opportunities and tests. The USMCA review process begins this month, with formal discussions expected to dominate trade policy headlines through mid-year. The new tariffs on Chinese imports will reshape supply chains and potentially affect consumer prices, while their long-term impact on domestic manufacturing and job creation remains to be seen.
Tourism’s continued momentum — bolstered by new flight routes and strong year-end numbers — positions the sector as a key economic driver, particularly with the FIFA World Cup on the horizon in June.
Whether the peso can maintain its remarkable performance and stocks continue their rally will depend on how successfully Mexico navigates these trade negotiations and implements its economic development strategy. The investigation into the Interoceanic Train derailment will also test the government’s commitment to accountability and infrastructure safety as it pushes forward with ambitious transportation projects.
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.
What surprises does 2026 hold for Mexico? (Shutterstock)
After a news-filled 2025, we begin another important year for Mexico. If you didn’t check out the results of how I did versus my 2025 predictions, you can check it out here. What will 2026 have in store for Mexico? These are my 10 predictions for the year:
1. President Sheinbaum will continue to have a 70%-plus approval rating. Nearly every president sees their approval rating consistently decline during their term; I think Sheinbaum will be an exception as she continues to guide the country through difficult domestic and international issues.
2. Sheinbaum and her team will be successful in renewing the USMCA agreement with the U.S. and Canada in a way that maintains and even strengthens the relationship between the countries. There will be drama, there will be fireworks, but ultimately, the deal will get done.
3. Sheinbaum and her team will continue to make progress against the cartels and on violence in the country. After very limited results for six years under AMLO, a step change in actions and results began in 2025. We will see it continue in 2026. The country and the world will take notice.
4. The Mexican peso will finally start to follow the laws of economics and weaken against the USD. I predict that the peso will devalue at least 10% and finish above 20 pesos to the USD. Why? Slower economic growth, lower interest rates and higher inflation rates will all be contributors.
5. GDP growth, which is predicted to be between 1 and 1.5%, will surprise to the upside. I think 2% is possible, fueled by World Cup tourism spending, government infrastructure spending, help from U.S. growth and foreign direct investment.
6. Mexico will make it out of the first round of the World Cup, but lose in the round of 16. Sorry Mexican fans, but I have seen it happen too many times before. That being said, Mexico will be a great host to the games and the world will take notice.
8. Continued tensions globally against China will make Mexico an increasingly attractive location for businesses to invest. As the U.S. receives more investment, Mexico will benefit as well. I think foreign direct investment will again hit a record in 2026.
9. AMLO’s legacy projects will begin to show some increased momentum. The Felipe Ángeles airport in Mexico City, the Dos Bocas refinery, the Interoceanic freight train, the Maya Train and the Tulum airport will all look like less “white elephant” projects than they did in 2025. They will all remain very far from profitability and expected capacity, but the momentum will be positive.
10. Sheinbaum will begin to make a positive dent in the energy industry. After largely ignoring the oil production (Pemex) and energy production (CFE) industries in 2025, she will begin to pressure them to reform and allow increased private investment. It will just be the start, but there will be a clear change in tone.
I will also add one “wild card” prediction. I think there is a strong possibility that there will be at least one drone strike against a fentanyl lab in Mexico. I don’t know if it will be done directly by the Trump administration, in coordination with the Sheinbaum administration, or solely by Mexico — but I think it will happen as the pressure is ratcheted up against the cartels.
What do you think? Do you agree with my predictions? Am I missing something? Please add your thoughts in the comments.
Travis Bembenek is the CEO ofMexico News Daily and has been living, working or playing in Mexico for nearly 30 years.
President Sheinbaum acknowledged that the government hasn't made progress reducing extortion rates. (Gabriel Monroy/Presidencia)
Over the past few weeks, I’ve watched a Mexican series on Netflix, “Las Muertas.” It’s a Luis Estrada series, meaning it’s a dark comedy that leaves you both amused and uneasy.
I’ve reviewed a few of his movies here before. Each one, really, is a Mexican classic. Watching them, you’d think he’s utterly without hope about our ability to shed our cultural habits of the sins of corruption and contempt. That’s the part that makes me uneasy. To watch his work, your only conclusion could be that corruption is baked into the culture. Like a cancer, it’s never completely eradicated; it hides in the cells and emerges opportunistically.
The problem of extortion in Mexico
The Luis Estrada series “Las Muertas” touches on a long-running problem in Mexico: extortion. (IMDb)
If you’ve got a strong stomach (and a tolerance for nudity and sex scenes that are both hot and off-putting), it’s a fantastic show to watch. I mean, I wouldn’t let my kid watch it. Not because of the sex scenes, but because of its bleak view of humanity. Why let her in on this cynical view of the world so soon?
I’ve been thinking about “Las Muertas” as I’ve read aboutSheinbaum’s desire to curb extortion. Clearly, extortion is a problem in Mexico. “Pay me and I won’t destroy you.” In fact,many businesses consider it a cost of doing business in the first place.
What exactly is extortion? Well, it’s forcing people to give you money by threatening them. “Pay up or else.” In Mexico, this often takes the form of “cobro de piso” (officially a “floor charge”), which is when criminal gangs, typically, charge businesses a sort of “tax” for “protection.” Protection from whom? Honestly, from the people charging the cobro de piso.
The poorest are most vulnerable
It breaks my heart that there are so many people willing to take advantage of others. It breaks my heart more that there are people who think they have a right to take advantage of others. They’re preying on the most vulnerable, of course. A fruit seller is paying 1,000 pesos of his meager earnings a week. Liverpool is not. The more money you have, the more protected you are.
That’s not all, of course. Extortion is increasingly attached to very scary scams. In the absence of any real authoritative controls in prisons, for example,prisoners with nothing but time on their hands and phones can spend all day trying their luck at tricking people into believing that a loved one has been kidnapped. “Pay up to this bank account, or else.”
How these prisoners have access to phones and their bank accounts in the first place is beyond me. Okay, it’s not really beyond me — it just amazes me about how confidently and brazenly those behind bars can act and with such few repercussions. Sheinbaum’s administration is doing what it can — signal jammers, security scanners — it will take more than that, of course.
Bribery and extortion are two sides of the same coin
Bribes are as ubiquitous a part of life for many Mexicans as extortion. (DepositPhotos)
In the show “Las Muertas,” the idea of “money as social and legal lubricant” wasn’t so much happening around extortion, but around bribery. Alas, they are two sides of the same coin, and sometimes indistinguishable.
In the show, the women got away with so much because they bribed every government official they could. “Money and extra special treatment at the brothel? You’ve got yourself a deal!”
Unfortunately, in Mexico, bribes still very much work. A common example that nearly every Mexican I know has encountered is being stopped by the transit police. Even for minor infractions, the threat is often that they’ll need to have the car towed off right then and there. “Or ...”
To get out of such a fate, most drivers pay the policea mordida — a bribe. But is it really a bribe if they have to pay it to keep their vehicle?
Extortion is forced upon the payer; bribery is voluntary from the payer.
Laws and the difficulty in enforcing them
Then there’s the icky in-between kind, like bribes to traffic cops and bureaucratic workers. “You know, I could focus on getting this paperwork through a lot faster if I didn’t have to work a second job to afford my poor mother’s medicine …”
Army, Navy and National Guard leaders accompanied Security Minister García Harfuch as he announced the new strategy against extortion in summer 2025. (Andrea Murcia/Cuartoscuro)
For so long in Mexico, under-the-table money has been the lubricant both for getting out of frictional situations and into the kinds of situations you want.
And as I’ve written before, the “on-the-ground” law in Mexico takes place at the local level, not the federal. Mexico City can turn out however many laws it wants, but without the cooperation of local governments, how can they be enforced?
So though Mexico City might say, “Okay, everyone, don’t let extortion happen in your towns and cities,” if the same people meant to enforce the law are benefiting from extortion schemes, how effective can that be?
Making extortion a federal crime
What’s the new proposal, then? Rather than being a state crime,extortion would now be a federal crime. That means it’s no longer a crime against the victim only; it’s a crime against society.
In addition to that, the burden would no longer be on the victim to report it. This is smart. Who’s going to report a crime when they’ve been told they’ll be killed if they report a crime? It’s not like they could trust the police to protect them — they’re often in collusion with the very criminal gangs they’re supposed to be protecting people from. It sounds cowardly, but police officers are people too, with families and fears.And they certainly don’t get trained or paid enough to go above and beyond in selfless ways, so what are we expecting?
But this law would up the ante: “Officials who are convicted of failing to report known extortion crimes face up to 20 years in prison, and prison authorities or public servants who facilitate extortion could be jailed for up to 25 years.”
Lime producers in Michoacán and their workers live under constant threat of extortion or physical harm, often requiring protection from the National Guard. (Galo Cañas/Cuartoscuro.com)
Well!
Extortion is disgusting; I do not approve of it under any circumstances. But you have to ask: Why is it so prevalent? And given the prevalence of extortion and bribery, why do so many people think this is the only viable business they might be able to maintain?
For answers to these questions, might I suggest a Luis Estrada movie?
