Financial and structural challenges set the course for Mexico under the new administration

During the fervor of the recent electoral season in Mexico, the hands of the incoming federal administration are tied to public finances that are weaker than what was acknowledged during the campaign. With the electoral fever in the rearview mirror and the political aftermath setting in, various crucial issues that went unnoticed amid the whirlwind of propaganda, debates, and voting are starting to gain relevance and project a significant impact on the country's immediate future. One of the main concerns lies in the country's budget deficit, which is historically high. During the first quarter of the current year, the deficit rose to 452.371 billion pesos, marking a drastic increase compared to the 158.343 million recorded in the same period of the previous year, according to information from the Ministry of Finance. This situation highlights the urgency of addressing measures to balance public finances and avoid further deterioration in the national economy. On the other hand, the country's total debt, measured as the Historical Balance of Public Sector Financial Requirements (SHRFSP), is estimated to exceed 50% of the Gross Domestic Product (GDP) again, reaching one of the highest levels in history. This financial burden limits the maneuvering capacity of the incoming government and poses significant challenges in the implementation of its government plans, especially in a context marked by global economic uncertainty. The president-elect of Mexico and her economic team face the complex task of managing a delicate fiscal situation, which could restrict the execution of public policies and key investment projects for the country's development. The necessary investment in infrastructure to take advantage of nearshoring, valued at $400 billion by 2032 by the Ministry of Communications and Transportation, is threatened by the precarious financial situation and the need to prioritize deficit control. Furthermore, the fragility of the Mexican energy system and its dependence on non-renewable sources such as natural gas have become a cause for concern, especially in the face of growing electricity demand and challenges arising from climate change. Recent blackouts and the evident lack of capacity to ensure a stable energy supply underscore the urgency of investing in infrastructure and sustainable technologies to ensure long-term energy security. In terms of inflation, despite the efforts of the Bank of Mexico to keep it within its target range of 3%, the indices continue to exceed expectations, standing at 4.65% in April. This increase, driven mainly by rising prices of agricultural products, disproportionately impacts the most vulnerable sectors of the population, worsening the living conditions of those already facing economic difficulties. Another crucial issue that emerges in the midst of the post-electoral landscape is the growing extortion crisis plaguing the country, with alarming rates of increase both nationally and in specific entities such as the capital. The authorities' inability to contain this phenomenon and protect citizens and business owners from its economic and social repercussions represents an urgent challenge that demands concrete and effective actions. In this context of uncertainty and economic challenges, it is essential for the new administration to responsibly and boldly address the structural problems threatening Mexico's stability and development. Beyond campaign speeches and promises, the country's economic and social reality demands concrete responses, solid policies, and a genuine commitment to the well-being of the population. Faced with the complexity of the challenges ahead, leadership capacity, strategic vision, and political will are essential to guide Mexico towards progress and shared prosperity.