Mexico’s energy policies conflict with USMCA trade alliance

mexico energy CFE, Mexico's Federal Electricity Commission power supply. Photo: Shutterstock
CFE, Mexico’s Federal Electricity Commission power supply. Photo: Shutterstock

Mexican President Andrés Manuel “AMLO” López Obrador has introduced policies focused on ensuring what he calls the country’s “energy sovereignty,” largely strengthening state-owned energy firms CFE and Pemex. 

However, according to the Joe Biden administration in the U.S., these measures have hindered American firms and go against the USMCA trade alliance, also known as the “new Nafta.”

In April, the Mexican leader sent Congress a bill planning to increase CFE’s market share from 38 to 54 percent. The proposal was rejected, which AMLO called an “act of treason.”

Now, USMCA representatives are voicing their own reservations. They claim that the “state-owned” energy comes largely from polluting plants, while private companies are “more committed” to more sustainable production. 

AMLO, however, said that Mexico will “not accept” interference from abroad. To ease tensions, Mexico’s Foreign Affairs Minister Marcelo Ebrard assured the government will consider USMCA concerns and present a plan to mitigate possible conflict.