EconomyForeign trade and USMCAPoliticsEnergy, technology and environment
Weekly Report — 11 September 2026
2.05%
Government's 2027 growth forecast, above the 1.8% private-sector average
3.9% of GDP
Projected 2027 budget deficit, down from 4.1% in 2026
−30,112
Employers registered at IMSS at the end of August, year on year
Economy
The Executive presented its economic package for 2027.1 In general, analysts have considered it too optimistic, given the recent trends and self-imposed restrictions on growth, investment, and formal employment, including a severe erosion of the rule of law and the dismantling of the regulatory institutional framework. The government expects 2.05% GDP growth, above the private sector's average expectation of 1.8%. Budget revenue would be MXN$ 9.15 trillion, 23.2% of GDP (3.9% more than in 2026), of which tax revenue would be 15.9% of GDP. Net expenditure would be MXN$ 10.51 trillion (0.7% more). Fixed expenditure (e.g. pensions, debt interest) will grow 0.2%, while variable expenditure (programmable) will grow 1%.
The budget deficit would decrease, from 4.1% of GDP in 2026, to 3.9% in 2027, but it looks increasingly doubtful that it will actually be 4.1% by the end of the year. Financial cost (basically debt service) would be MXN$ 1.57 trillion, or 4% of GDP; pensions would take MXN$ 1.84 trillion, 4.7% of GDP. Public investment would be 2.6% of GDP, or 67% of the figure for debt.
Absolutely refusing to implement any tax reform, with little investment, lethargic growth, declining formal employment proportion, and the urgent need to keep investment grade (containing deficit and debt), the government is trying to obtain additional tax revenue of MXN$ 580 billion, of which MXN$ 130 billion would come from a reduction in fiscal deductions. The problem is that all the new revenue will have to come from the same pool of firms. Even worse, it is shrinking, as firms opt out of formality, in large part because of the nightmarish and onerous tax-paying process, plus unsustainable minimum-wage increases: by the end of August, and compared to a year before, there were 30,112 employers less among those registered in IMSS (social security). All this, without reining in the accelerating rate of growth of cash transfers (2027 is midterm elections year).
In August, at annual rate, inflation grew 3.26%, less than expected, but more than July's 3.12%. The core component was 3.88%.
Foreign trade and relations, US–Mexico and USMCA
The US secretary of Commerce, Howard Lutnick and President Sheinbaum met via videoconference. Sheinbaum emphasized Mexico's objective to reduce U.S. tariffs on steel, aluminum, and the automotive sector, calling them unfair and economically damaging. Both sides reaffirmed that maintaining the trilateral trade agreement (USMCA) remains in the shared best interest of Mexico, the U.S., and Canada.
Politics and social issues
In the newly released PISA 2025 results, Mexico's average score decreased in both mathematics and reading, continuing a downward trajectory and leaving Mexican 15-year-old students significantly behind the global averages. Mexico placed 64th out of 91 participating economies globally. Within the inner circle of the OECD, Mexico ranked near the very bottom — 37th out of 38 member countries. While the downward trend is certainly a global phenomenon, in Mexico, where there had been gradual progress 2003–2018, it has been aggravated by a damaging education counter-reform, almost zero budget for teachers' training, the ideologization of the curriculum, and the deliverance of control to trade unions, in particular the radical, corrupt, and insatiable CNTE.
INE formally inaugurated the 2027 elections process. 102 million Mexicans are entitled to vote. All 500 members of the federal Chamber of Deputies will be at stake, as well as, at the local level, 17 governorships, local congresses in 31 states, and municipalities in 30 states.
Turning back the clock almost thirty years, President Sheinbaum sent an initiative to bar from elected public office people with double nationality. The problem is, during the XXI century many Mexicans have gotten this status, mainly with the US and Spain, following a worldwide trend stemming from globalization. INEGI estimates 18–21 million Mexicans have another nationality. Most live abroad, but a sizable portion live in Mexico. Critics have said this is the least important of Mexico's many pressing issues.
Technology, environment, health, industries and services
Next year's budget includes an almost 70% reduction in government cash transfers to PEMEX, to USD$ 4.8 billion, hoping that the firm registers a USD$ 5.6 billion financial surplus. So far in the MORENA administrations, government transfers and financial support have been at least USD$ 130 billion.
PEMEX is losing MXN$ 1.75 million a day, containing gasoline prices to consumers. This, of course, is an additional financial burden on the firm, and on taxpayers who subsidize it with cash transfers to keep it going.
After many months of decreases, in August the production of heavy vehicles reached 16,389 units, 100.2% more than a year before. Jan–Aug, the increase is 2.65% annually. By far, most of that was exported: 14,310 units, a 116.7% growth. Jan–Aug, exports grew 3.71%.
Footnotes
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Analysis and graphs of the package: México, ¿cómo vamos?, https://mexicocomovamos.mx/publicaciones/2026/09/un-primer-vistazo-al-paquete-economico-2027/ ↩
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