Mexico’s week in review: Sheinbaum delivers her second-year report as trade tensions simmer

The week of Aug. 31, President Claudia Sheinbaum delivered her second annual government report, reflecting on the state of the nation as her second year in office draws to a close. She touted falling homicides and a stable economy, only to face a pointed rebuttal from opposition leaders who accused her administration of manipulating crime statistics and shielding officials tied to drug trafficking. Mexico continues to grapple with security challenges on a variety of fronts, a fact underscored by a car bomb in Zacatecas Sunday night — the state’s third such attack in four days. But Mexico’s security forces remain active and on Monday claimed a high-profile target: Soldiers and marines killed Luis Enrique Barragán, alias “R5,” the accused leader of extortion against Michoacán’s avocado growers, in a shootout in Tocumbo. Trade friction with Washington ran through much of the week. A dispute over cheese naming rights is complicating already-strained talks over the U.S.-Mexico-Canada Agreement (USMCA). Mexico continues to push back against the threat of U.S. tariffs, and Economy Minister Marcelo Ebrard met U.S. Commerce Secretary Howard Lutnick on the sidelines of a G20 gathering Wednesday to press Mexico’s case against tariffs on steel, aluminum and cars. Didn’t have time to catch this week’s top stories? Here’s what you missed. Sheinbaum’s second-year report meets a sharp opposition response President Sheinbaum delivered her second annual government report Tuesday, a 67-minute address touting a 51% reduction in homicides since taking office, record foreign direct investment and a stable economy. She said her administration’s relationship with Washington “has had its challenges” but reiterated that “sovereignty isn’t negotiated, handed over or shared.” Opposition senators offered a starkly different account. PAN’s Ricardo Anaya disputed the government’s homicide figures, arguing that reclassified deaths obscure a rising toll, while PRI’s Alejandro Moreno accused the administration of an unspoken “pact” with organized crime, pointing to the unresolved U.S. extradition request for Sinaloa Governor Rubén Rocha Moya. Sheinbaum has said her administration won’t shield anyone who has committed a crime. In second annual report to the nation, Sheinbaum hails a stronger, safer and more prosperous Mexico The president also used Wednesday’s press conference to accuse the Trump administration of trying to “create divisions” within her cabinet ahead of November’s U.S. midterms, calling it part of a long-standing U.S. pattern of pressuring “independent governments.” Her approval rating stood at 68% heading into the report, among the highest of any Mexican president at this point in a term, according to polling firm El Financiero. Along with the high approval rating, the newest results of the MND Sheinbaum Index™ found an almost 10-point increase in the president’s performance. Security: Zacatecas car bomb and a cartel leader’s death Eleven people, including a policewoman, were injured Sunday night when a car bomb exploded outside a municipal police station in Ojocaliente — the third explosives attack in Zacatecas in four days. Authorities are investigating whether the blast was retaliation for the Saturday capture of an alleged Jalisco New Generation Cartel (CJNG) sicario. The explosion damaged 30 properties and 13 vehicles; classes were suspended and army troops deployed to the municipality. The next day, Mexican Army and Navy forces killed Luis Enrique Barragán Chávez, known as “El Güicho” or “R5,” in a shootout in Tocumbo, Michoacán. Federal Security Minister Omar García Harfuch identified Barragán as the leader of the Cártel de Los Reyes and the main coordinator of extortion against avocado producers in the state; the U.S. had offered a $3 million reward for his arrest on drug and firearms charges. At her Friday mañanera in Zacatecas, Sheinbaum’s Security Cabinet reported the state’s daily homicide rate fell 85% in August compared to September 2024, and that more than 3,800 people have been arrested there since she took office. Defense Minister Ricardo Trevilla Trejo, responding to a Fox News report on U.S. anti-drone operations at the border, said the drones are mainly used by migrant smugglers and declined to confirm Mexican military involvement in the U.S. takedowns. An attack on the municipal police station in Ojocaliente, Zacatecas, prompted renewed attention to federal security operations in the state. (Adolfo Vladimir / Cuartoscuro.com) Mexico-U.S. trade relations: Tariffs, cheese and an uncertain USMCA Mexico-U.S. trade talks hit a snag over cheese this week, with U.S. officials pressuring Mexico to amend a May agreement with the European Union that grants regional-name protections to products like Parmigiano Reggiano and manchego. The U.S. government’s position is that these names are generic; the European Commission says the deal isn’t open to amendment, leaving Mexico caught between two trading partners. Economy Minister Marcelo Ebrard met U.S. Commerce Secretary Howard Lutnick on the sidelines of a G20 Innovation Ministerial in North Carolina on Wednesday, pressing the U.S. to lift tariffs on Mexican cars, steel and aluminum, which Mexico calls unjustified. Sheinbaum said Thursday her government is working to secure a better tariff agreement, noting that most Mexican exports still enter the U.S. duty-free under the USMCA. The tariff dispute traces back to Washington’s decision not to renew USMCA in its current form for a further 16 years, leaving the pact’s future — and Mexico’s manufacturing-heavy states — in limbo pending ongoing bilateral talks. Economy: The peso strengthens as growth forecasts improve The peso hit a 28-month high against the dollar on Friday, trading at 16.863, reviving talk of a “super peso.” Analysts attribute the gains partly to peso strength and partly to the dollar’s weakness. A stronger peso cuts import costs and inflation but squeezes exporters’ margins and remittance values, with agricultural states like Michoacán most exposed. Earlier in the week, Banxico raised its 2026 GDP growth forecast to 1.5%, up from 1.1%, citing stronger-than-expected second-quarter growth, while flagging USMCA uncertainty and geopolitical tensions as downside risks. Mexico’s tourism sector added a bright note: The World Travel & Tourism Council ranked Mexico fourth globally in tourism-generated GDP, behind only the U.S., China and Germany, with Quintana Roo cited as the main driver. Looking ahead Trade talks with Washington remain unresolved on both cheese labeling and industrial tariffs, with no clear timeline for a new USMCA agreement as bilateral dialogue continues. Meanwhile, Hurricane Marie, a Category 2 storm off Baja California Sur, is expected to weaken to a Category 1 by Saturday as it moves out to sea, though Conagua warned that atmospheric instability could keep bringing rain to the country’s interior into next week. Zacatecas remains under heightened security following last week’s car bomb attack, with federal, state and municipal forces reinforcing operations in Ojocaliente. Some good news to end the week Pijijiapan Mayor Carlos Alberto Albores celebrates his town’s world record for the world’s biggest cheese ball, made of the region’s traditional quesillo string cheese. (Sectur / X) Cheesemakers in Pijijiapan, Chiapas reclaimed the Guinness World Record for the world’s biggest cheese ball. Heavy August rains pushed Mexico City’s Cutzamala reservoir system to its highest level in a decade. A team of Mexican researchers will build a detector to track particles from the universe’s earliest moments for CERN’s Large Hadron Collider. Archaeologists in Veracruz uncovered a ceremonial plaza and stele with features never before recorded in the region. 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.