On June 11, the U.S. national soccer team will play a World Cup qualifier in Mexico. If any event can act as a gauge of current Mexican sentiment toward its northern neighbor, it will be this. Matches between the United States and El Tri, Mexico’s national team, are always raucous affairs, but this time around, the political climate between the two countries will take things to a whole new level.

In Mexico, U.S. President Donald Trump’s vow to “build a wall” along the U.S.-Mexican border, and to have Mexico pay for it, as well as his fiery rhetoric about illegal migrants and enhanced deportation measures, has created a rare moment of unity behind Mexican President Enrique Peña Nieto. That’s something the U.S. team will see in full form during its trip to Mexico City.

Mass protests in several Mexican cities on February 12, including around 20,000 people in the capital of Mexico City alone, have been the most public displays of the nation’s rejection of Trump’s putative policies. Meanwhile, the Mexican government’s official response to the Trump administration has been carefully, if forcefully, worded, even if former President Vicente Fox has, perhaps, better captured the current national mood with a series of expletive-laden tweets against any wall-building plans.


How long Mexican unity can last is another matter. Whatever a Mexican official’s opinion of Peña Nieto, even the slightest indication that he or she does not stand firmly behind him in his rejection of Trump’s demands would be tantamount to career suicide in the current climate. The president’s approval ratings rebounded five points in January (although they remain stuck below 20 percent overall) after his rejection of a bilateral meeting with his U.S. counterpart in protest against the latter’s public declarations on Mexico. As one important sign of cross-party cooperation, the main opposition National Action Party (PAN) was happy for one of its own, Gerónimo Gutiérrez, to be named the new U.S. ambassador, the role taking on extra importance in the new reality of U.S.-Mexican relations.

Whatever a Mexican official’s opinion of Peña Nieto, even the slightest indication that he or she does not stand firmly behind him in his rejection of Trump’s demands would be tantamount to career suicide in the current climate.

However, agreement on the president’s stance toward the United States does not imply support for his administration in all its aspects. His domestic political agenda will continue to divide Mexicans. (Ongoing polarization over the Peña Nieto administration’s decision to raise gas prices at the start of 2017 is the clearest example.) And soon, Mexico’s domestic politics will begin to take center stage; later this year, campaigning will begin in earnest for the 2018 presidential elections. The incentive for the opposition to work with Peña Nieto will diminish as each viable candidate starts staking his or her positions for the elections.

Realistically, that leaves a small window for Peña Nieto to make significant headway in negotiations with his U.S. counterpart over the future of U.S.-Mexican relations. There is, of course, far more to consider than just the wall. The future of the North American Free Trade Agreement (NAFTA), immigration more broadly, and general cross-border security issues are all on the agenda.

Mexico, of course, has no particular desire to redraw NAFTA or discuss a wall, but if forced to negotiate, it would prefer to do so in the context of an overarching framework that encompasses all such pending issues. Doing so would help it enhance its leverage with the United States. But it would also bring a level of complexity to any negotiations that would be difficult to resolve in just a few months. The question, of course, may be just how much Peña Nieto and Trump are willing to let talks become subject to the vagaries of the Mexican election campaign. The Institutional Revolutionary Party, and particularly Foreign Minister Luis Videgaray, with an eye on presidential ambitions of his own, has every incentive to avoid a drawn-out process that takes years rather than months.

Members of the Mexican national soccer team celebrate a goal against Canada in a World Cup qualifier in Mexico City, March 2016.
Edgard Garrido / Reuters


That question also becomes particularly pressing if Andrés Manuel López Obrador (called “AMLO”) continues to make headway in the polls. A two-time presidential contender with strong populist and nationalist credentials, AMLO is well placed to launch his strongest run yet for the presidency. Surveys in February give him a six-point lead in the 2018 presidential race; in November 2016, he had been running neck and neck with the PAN’s likely contender Margarita Zavala.

In part, this stems from the Mexican domestic situation. Public anger over entrenched corruption is mounting; disappointment with the Peña Nieto administration’s economic reform program, which has failed to deliver the promised levels of growth, is growing; and the security situation shows few signs of improving. All these issues are meat and drink to AMLO’s populist platform, while other major parties may find it difficult to escape association with the “failures” of the Peña Nieto administration, given the broad “Pact of Mexico” he formed with the PAN and others at the start of his administration to secure passage of his legislative agenda through Congress.

Meanwhile, the impact of Trump’s win and Mexican relations with the United States more generally could also play into AMLO’s hands. Indeed, there is a case for suggesting that, in his own way, AMLO is Mexico’s Trump. The two may be from different sides of the political spectrum, but their appeal to the electorate comes down to similar issues: they are the ones sticking up for those left behind by globalization. They are the outsiders pledging to bring down the political elite and “drain the swamp” or, in AMLO’s terms, destroy the “mob in power.” If Trump can be considered the principal embodiment of a populist political sentiment in the United States, so can AMLO similarly lay claim to being the leader of that movement in Mexico.

Moreover, if the Peña Nieto administration is perceived to show signs of weakness in negotiations with the United States, to give up concessions for no apparent return, AMLO again is likely to be the principal beneficiary. For many, his long-term track record of nationalist rhetoric makes him more credible than contenders from the traditional Mexican political parties—the PAN and the Party of the Democratic Revolution, for example—which have long been more friendly toward the United States. There is little doubt that AMLO will be watching any talks closely and seeking opportunity for personal political gain where it arises.


Mexico’s economic outlook is uncertain. With 80 percent of Mexican exports going to the United States, any renegotiation of NAFTA has a huge bearing on the country’s future prospects; the International Monetary Fund has already revised Mexico’s projected GDP growth in 2017 from 2.3 percent to 1.7 percent in the wake of Trump’s victory. AMLO’s election on top of that would add a whole new layer of uncertainty to the situation.

On the one hand, AMLO is known as pragmatic, and he did widely applauded work to attract private investors to Mexico City while he was mayor between 2000 and 2005. On the other hand, he is known for frequent antibusiness tirades and has pledged to stage a referendum on Peña Nieto’s flagship energy reform, which opened up the sector to private investors for the first time in over 70 years.

Meanwhile, he would almost certainly not have any sort of working majority in Congress. He has a history of confronting institutions and can use street power to achieve his political goals. One nickname, “Chávez Obrador,” speaks to concerns among many Mexicans that AMLO would take Mexico on a similar path to that traveled by Venezuela under Hugo Chávez and his successor, President Nicolás Maduro. 

There is time left for the electoral equation to change. AMLO is the only declared major contender at this stage, allowing him free rein to begin his campaign unofficially. But for companies with interests in Mexico, scenarios that were almost unthinkable a few months back are becoming more and more likely. In a short time, new question marks have emerged over Mexico just at a moment when it had emerged as an increasingly sure bet for investors in Latin America—albeit with important challenges such as security and corruption thrown in. Although many opportunities still exist that make Mexico an attractive proposition—including a growing consumer class, significant infrastructure needs, untapped oil and other mineral resources, and increasing connectivity to the rest of the world—the risk-reward calculations are changing. The upside for investors can remain high, but reaching it may involve a few extra obstacles in the months and years to come.

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  • SIMON WHISTLER leads the political risk analysis and consulting practice for Latin America at Control Risks, the international risk consultancy.
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