Elites' beach playground, Tax the Rich Reform & Tycoons' Fight Club

Mexico Decoded’s weekly briefing makes sense of the news that matters

1. Mexico-China Heavy Tensions

Mexico imposed steep new tariffs on Chinese goods—especially in the automotive sector—and Beijing is not taking it lightly. China launched its own investigation into Mexico’s trade barriers and warned it will “take necessary measures” in response.

Decoding it:

Washington pushed Mexico to raise tariffs on China, arguing the country has become a “backdoor” for Chinese exports into the U.S. But Mexico’s move is also self-serving: it’s part of an import substitution strategy to favor domestic production, make Asian goods pricier for consumers, and strengthen local industry.

2. Injunction Reform to Tax the Rich

Mexico’s Senate approved a reform to the injunction law aimed at speeding up cases and closing the loopholes long exploited by wealthy taxpayers and corporations to delay or dodge payments.

Decoding it:

Some lawmakers from Sheinbaum’s own party pushed to make the law retroactive —a move that would’ve breached constitutional limits. The President personally stepped in to stop it, signaling that even as she targets tax evasion, her government still knows where to draw the line.

3. Tycoons’ fight club

Mexican tycoon Germán Larrea made a made a surprise bid to buy all of Banamex, Citi’s Mexican retail arm and one of the nation’s most storied banks. He’s going head-to-head with another tycoon, Fernando Chico Pardo, who last week offered to buy a 25% stake. Citi reportedly favors Chico’s offer since it’s easier to pass antitrust review —but Larrea’s bigger check might be hard to turn down.

Decoding it:

Shares of Grupo México —the conglomerate behind Larrea’s empire— tanked right after his announcement. At Citi’s asking price, Grupo México would end up worth less than the sum of its parts. Larrea’s move looks less like strategy and more like a tantrum against an old foe.

4. DEA Hits Hard

The DEA seized a million counterfeit pills and 77 tons of narcotics in a five-day operation against the Jalisco New Generation Cartel, one of Mexico’s most powerful criminal groups. The operation, which was carried out in the U.S. and seven other countries, cost the CJNG an estimated 48 million USD, according to the DEA.

Decoding it:

Reports suggest the CIA has been quietly coordinating with select Mexican military units on major cartel takedowns. But the DEA’s latest blitz—and its chief’s fiery rhetoric—signal the agency has no plans to play second fiddle.

5. Elite Beach Airport Is Doing Just Fine

Tulum’s new airport—serving Mexico’s Caribbean playground for the elite—has faced a wave of bad press over reduced flights and canceled routes. Headlines suggest it’s floundering.

Decoding it:

True, the airport had a rocky start to the year. But traffic is actually up 97% from last year, which was already 30% above original projections when it opened in 2024. The real mystery: who funded the smear campaign? The likely winner of the negative buzz is Cancun’s airport.