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Claudia Sheinbaum

CJNG Propaganda Knocks At Mexico City’s Door Again

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Four videos in six and a half months, a very long list of names and threats and, above all, ubiquitous warlike paraphernalia: weapons, bulletproof vests, helmets. A branch of the Jalisco New Generation Cartel (CJNG) is running a full-blown propaganda campaign in the south of Mexico City, the State of Mexico, and Morelos, criticizing the tactics of rival criminal groups in short videos. They condemn extortion, accuse others of usurping their brand and announce major “cleanups” of local gangs. Sometimes they single out politicians and local officials; on other occasions they ask that no one be protected. They say they are the ones who will restore order.

The images have drawn attention for the initials on the vests of those featured — CJNG — a name bearing grim resonance in the capital after the June 2020 attack on then-police chief Omar García Harfuch, now Claudia Sheinbaum’s federal security secretary. A long-standing tactic of organized crime groups in Mexico, the footage has also shocked for what it proclaims: the muted announcement of an incursion, a prelude to wars and atrocities the country has seen plenty of over the past 20 years. In the capital, authorities are studying the videos but avoid speaking of alarm.

The four clips — the first released in December and the latest this week — appear to be filmed at the same location: a property among low hills in a rural area. In the second, released March 1, more than 20 figures appear, hooded, wearing balaclavas and caps, all heavily armed. In the others the shots are tighter and not all members can be seen. The staging is similar across the four: one figure, a man, reads from a mobile phone screen; the others remain silent. In the first video, from December 27, a drone is seen flying over the group on the left side.

The images suggest a territorial push by this CJNG branch, first in Morelos — in Huitzilac, Jiutepec and Emiliano Zapata — and later in the south of Mexico City, in the boroughs of Tlalpan, Xochimilco and Tláhuac. In the first two, the visible message and paraphernalia link the group to La Gente del Serio, a CJNG faction allegedly led by Francisco Jaramillo Valdovinos, alias “Serio.” Over the past year that group has released other videos touting its activities in Guerrero. Press reports link Serio to Audias Flores, “El Jardinero,” a second-tier CJNG commander arrested in April in Nayarit, where he had relocated in recent years.

Once powerful, the CJNG now operates amid uncertainty. In February, soldiers killed Nemesio “El Mencho” Oseguera in an operation in the municipality of Tapalpa, Jalisco. In April, marines arrested El Jardinero, one of the main contenders to succeed him, leaving only Mencho’s stepson, Juan Carlos Valencia, alias “03,” and Gonzalo Mendoza Gaytán, “La Rana,” linked to the criminal group’s forced-recruitment operations in Jalisco, at large among the top leadership. Questions about how deep the criminal group’s crisis goes after these blows dominate the panorama. Its capacity to continue expanding, as in previous years, is in doubt.

That is why authorities are cautious: they have seen similar situations before — propaganda videos from criminal groups announcing their arrival in the capital, a way to flaunt strength in front of rivals. In 2022, for example, a suspected faction of La Familia Michoacana did the same, announcing its presence in another southern borough, Milpa Alta. But current caution requires attention, given the CJNG’s criminal record in the capital, notably the near-fatal attack on García Harfuch. That assault illustrated the group’s reach and how easily it was able to organize an assassination attempt on a high-ranking official without being detected.

As often happens in these cases, La Gente del Serio’s videos stress they have no problem with authorities so long as they do not support the “extortionists.” In the latest clip, released Monday, they declare war on Unión Tepito and the Tláhuac Cartel to “restore order” in Mexico City and the State of Mexico. “We’re going after all the extortionists from Unión Tepito and the Tláhuac Cartel […] This goes out to all those who are collecting protection money in our name, seizing houses and land like El Yayo and El Macero,” a man reads from his cellphone. Unión Tepito is the capital’s long-established mafia, repeatedly reborn and fed by criminal networks in the downtown area. The Tláhuac Cartel targets small local gangs in the south.

The mention of Macero and Yayo is not new. In the May 28 video, the penultimate clip, a man dressed in black says: “This is a communiqué for Tlalpan and its towns — Parres, Topilejo, San Miguel Xicalco, La Magdalena, San Miguel Ajusco, Santo Tomás Ajusco, San Andrés, San Pedro Mártir, San Salvador Cuautenco, San Mateo Jalpa, San Francisco Tlalnepantla and all of Xochimilco. You are informed that the cleanup has already begun. We’re coming for all the fucking filthy extortionists, starting with you, Chucho Macero, Yayo […] Stop pretending you’re the company [the CJNG], because you are not. Authorities, the problem is not with you.” A former criminal operating in the capital, Macero has been arrested several times. His current whereabouts are unknown.

The earlier videos, from March and December, target Morelos-based mafias. The March clip mentions Jiutepec and Zapata, in the Cuernavaca metro area. A man reads: “This message is addressed to Jiutepec and Zapata — to merchants, unions, bars, restaurants, towing yards, taxi drivers, routes, grocery stores: stop paying protection money and extortion.” He then accuses Jiutepec’s municipal president, Eder Rodríguez, of protecting extortionists. “Anyone who does not align will be eliminated. Get out before the war with the four letters [CJNG]. We are the same ones from Huitzilac and Temixco. Now present in Jiutepec and Zapata. And we’re going after all of Morelos,” he adds.

The reference to Huitzilac, in northern Morelos, near the capital, ties back to the December video. This time the speaker says: “To all the people of Huitzilac: you are informed that we are already here and present throughout the state. We do not harm third parties. What we want is peace. And all those fucking filthy people who try to defame our initials, who put up fake posters, who killed two of my guys, I will not forgive them. The turf is ours. To the government, we do not get involved with you. We want to cleanse the community, but if you support those people, you know what happens. We’re bringing the full tactical and technological team to track anyone who impersonates us.”

The man names “Purinas, Mancillas, Mundo, Colillo, Cagueros and Panteoneros,” among others. Alejandro Mancilla, Huitzilac’s municipal secretary, was murdered in 2025, as was his son Erick. The Purinas are a local Huitzilac criminal gang, a fact once acknowledged by Admiral José Ortiz Guarneros, former Morelos security secretary during Governor Cuauhtémoc Blanco’s administration (2018-2024).

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Former Ambassador To Mexico Ken Salazar Says In His Memoir That No US Agent Traveled On The Plane That Transported ‘El Mayo’ Zambada

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Former U.S. ambassador Ken Salazar could not have picked a better moment to promote his memoir, Borderlands, which is about to be published later this month by BenBella Books. This week Salazar has been in the Mexican government’s crosshairs over the murky capture of Ismael El Mayo Zambada, leader of the Sinaloa Cartel, and his subsequent transfer to U.S. authorities two years ago. President Claudia Sheinbaum’s government accuses the man who served as ambassador during Joe Biden’s presidency (2021–2025) of lying about the circumstances of that arrest, which took place without the knowledge of Mexican authorities.

The matter resurfaced after it was revealed that the FBI had possession of the plane used to transport the drug lord and even claimed credit for the operation. At the time, Salazar denied that his government had been involved in the case, which has ignited suspicions in Mexico that Washington runs covert operations on its soil without authorization.

In his memoir, of which EL PAÍS has obtained a copy, the former official provides details of El Mayo’s capture and how it ultimately led to a diplomatic rupture with then- president Andrés Manuel López Obrador. Salazar insists that the United States did not provide resources to carry out the operation; instead, he attributes Zambada’s fate entirely to the “betrayal” — in exchange for judicial benefits — of his own godson, Joaquín Guzmán López, a blood relative of Joaquín El Chapo Guzmán, who was an old associate of El Mayo. Suddenly the United States had two very valuable targets in custody, not thanks to the Mexican government, but rather because of what appeared to be a hostile action taken by one cartel member against another, writes Salazar.

Salazar also writes he did not learn of Zambada’s transfer until after it had been completed, and that it was a complete surprise. According to his account, he hurried to inform then-president López Obrador that his country had nothing to do with it, as he knew that these arrests could deeply upset Mexico’s outgoing president: “I suspected he would find it hard to accept that the U.S. government had not been directly involved in any way.” Salazar indicates that Washington was aware the issue of interference would be sensitive for the president, and insists in his memoir that the United States had no prior knowledge of this abduction and that under no circumstances did it carry out an unauthorized operation on Mexican soil, “which would have been a serious violation of its sovereignty.”

Salazar’s explanations at the time did not soften López Obrador, and they have now put the former ambassador squarely in the spotlight again. Last week it emerged that the FBI had donated to a New Mexico museum the Beechcraft King Air 200 in which El Mayo Zambada and Guzmán López, known as El Güero, arrived on July 25, 2024. Several outlets released previously unseen images of the plane’s arrival that day showing the two kingpins disembarking the aircraft, apparently surrounded by U.S. officials. The question is whether those officials, or some of them, also traveled on the plane that took off from Culiacán, the capital of Sinaloa — which would confirm Mexico’s suspicions of alleged violations of Mexican sovereignty.

According to Salazar, there were only three people on board: the two traffickers and the pilot, whose identity remains unknown to this day (the ambassador told Mexican authorities the pilot was not American and had not been hired by his government). The memoir adds that after takeoff the plane turned off its tracking systems and reappeared near the border. Only then were U.S. authorities notified. This account matches what U.S. officials told their Mexican counterparts. After the notification, Salazar recounts, the FBI office in El Paso, Texas, hurried to send an arrest team and SWAT [special weapons and tactics] to the runway, which received the Beechcraft on landing. The plane taxied a short distance to the waiting team and, after the pilot shut down the engines, the door opened.”

First out was El Güero “with his hands up.” While agents pointed guns at him, he identified himself by name and was then handcuffed. Zambada did not come down; rather, Salazar says, authorities had to enter the plane to get him out. According to his account, agents boarded the aircraft and found a figure heavily sedated, plastic restraints securing him to his seat. To their surprise it was Ismael El Mayo Zambada,” he explains. Salazar then recounts details of the meeting to which the kingpin was lured by deception by his own godson, how he was subdued and forced onto the plane. He also describes efforts he made to clear Washington of any responsibility, including a new private message he sent to López Obrador, this time co-signed by the then U.S. attorney general, Merrick Garland: “It was not our plane, nor our pilot, nor our operation,” they wrote to the president, who again did not respond.

The El Mayo case, coupled with Salazar’s criticisms of the judicial reform promoted by López Obrador, shattered the bilateral relationship. The Mexican president at the time feared the operation in Sinaloa could trigger a wave of violence, as ultimately happened.

The former ambassador says one of his sources, a prominent businessman who “was a friend and confidant” of the president, told him that López Obrador was “very worried” about what information the United States might obtain from Zambada — that he might “reveal secrets” about Mexican officials. President Sheinbaum stepped in and clarified that if her predecessor was worried about anything, it was about U.S. interference in Mexico. She has again demanded explanations from Washington to clear the lingering clouds over the El Mayo case.

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Claudia Sheinbaum

How Organized Crime Captured A City In Mexico

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The visit is arranged beforehand. There is little lingering at the door: come in, come in, don’t stand out there. The businessman sits down in a chair and offers the sofa. “Water?” He brings two bottles.

“Three weeks ago, they killed a woman right next door. It was in the morning,” he says. A woman who was there wondered why the ambulance had not arrived. “And another woman who was with her said, ‘No, they’re waiting for her to die’… They’ve killed paramedics too, just for treating victims,” explains the businessman, who gives neither his name, nor the nature of his business, nor the neighborhood where he lives, nor his age — nothing. Violence is the currency of the Mexican city of Cuautla, in eastern Morelos, and the man avoids every possible risk. In the kingdom of extortion and retaliatory gunfire, every precaution is justified.

Cuautla has become a national emergency in Mexico, a vivid example of the country’s criminal dysfunction. It is a city shaped by the unchecked influence of criminal groups, which have infiltrated local government while ruling through violence and intimidation.

In May, as part of the federal Security Cabinet’s Operation Swarm against institutional corruption, authorities arrested the backbone of the municipal administration. From the mayor to the treasurer, including the municipal secretary and the chief administrative officer, key officials were taken into custody. One target escaped: the official in charge of markets and the wholesale food distribution center, who remains at large.

The arrests stem from the alleged collaboration of the local government team with a criminal organization linked to the Sinaloa Cartel and Unión Tepito. The group reportedly controlled street vending, the local slaughterhouse, markets, and the cadastral and property-tax offices, among other sectors.

The problem extends beyond the timeframe and scope of the federal government’s efforts under Mexican President Claudia Sheinbaum. Cuautla reflects a nationwide problem. It is not an exception but rather the rule in many large and small municipalities across Mexico, where powerful political-criminal alliances impose or tolerate systems of extortion and the siphoning of public funds and local economic activity. In this way, criminal organizations prosper and spread across entire regions. What they do in one municipality is repeated in the next. And if not by them, then by others.

The arrests in Cuautla are not isolated cases. Authorities have also detained, in connection with the same matter, the former mayor of Yecapixtla and the current mayor of Atlatlahucan —neighboring municipalities — as well as a mayoral candidate in Atlatlahucan and the former mayor of Ayala, another nearby town.

The climate of insecurity in Cuautla, Morelos forces businesses to close.

It all began in an avocado grove. Or at least the latest chapter in the criminal cycle did: the rise of a criminal group, pressure from cartel bosses, the infiltration of local institutions and, finally, public scandal.

Long accustomed to compromising images of its politicians, the state of Morelos learned in February last year that a regional crime boss known as “El Barbas” — apparently linked to the Sinaloa Cartel faction operating out of Guasave and Los Mochis — had been meeting with mayors and other officials from the eastern part of the state, where Cuautla serves as the regional hub. There was even a video of one such meeting, held in the summer of 2024, shortly after the latest local and state elections.

Gathered in an avocado grove in Totolapan, near Cuautla, El Barbas appeared alongside all those arrested in Morelos last month: Cuautla mayor Jesús Corona, of the coalition between the Institutional Revolutionary Party (PRI), National Action Party (PAN) and the Party of the Democratic Revolution (PRD); the mayor of Atlatlahucan, from the same coalition; and Irving Sánchez Zavala, the former PAN mayor of Yecapixtla. Several Cuautla officials also attended, including the chief administrative officer, the municipal secretary, the treasurer and the official in charge of the markets.

Someone recorded the meeting. Someone kept the footage. Then, in February 2025, it was leaked. Authorities opened an investigation, building the case with intelligence reports and witness testimony. A little over a year later, in May, they arrested almost everyone who had attended the gathering.

Members of the Mexican Navy clashed with members of the Beltrán Leyva cartel at the Altitude residential complex in December 2009.

The arrests have raised a host of questions in Morelos, though not so much about the credibility of the allegations — which had been the subject of local gossip for years — as about the realization that the problem cuts across party lines, spans the political spectrum and long predates the current administration.

After all, Corona himself has served twice as mayor of Cuautla, the first time under the banner of the Morena party, from 2019 to 2021. And then there is the Sánchez Zavala family — three brothers and their father — who, under either the PRI or PAN banner, have dominated politics in Yecapixtla for more than a decade. As a former federal official in Morelos, interviewed by EL PAÍS in recent days, put it: “It’s an interparty organized-crime issue. I don’t think any party or government from the last 15 years is exempt.”

The dealings between criminal organizations and local governments, which change hands every three years, create tensions that build up in overlapping layers. Sooner or later, these arrangements tend to unravel. These arrangements also govern the management of the illegal economy: the extortion of restaurants, bars and factories, as well as the retail drug trade, where competition is fierce. In both spheres, violence is the preferred means of settling disputes.

In Cuautla these days, a former senior local official with first-hand knowledge of the region’s shifting power dynamics over the past 15 years put it bluntly: “The problem began when they were allowed in.” He was referring to the criminals — and to the local bureaucracy, a source of revenue in Mexico every bit as lucrative as drug trafficking.

The great decline

There is always a before and an after, however blurred the dividing line may be. In Cuautla’s case, that line can be traced to the final years of Corona’s first term in office, in 2020 and 2021: the beginning of its great decline.

A source familiar with local politics — who has at times advised federal authorities and requested anonymity — says: “That was when street vending really began to get out of control, a lot of bars opened and stayed open until the early hours, and attacks also started to happen.”

Street vending and bars are not, in themselves, a problem. The issue was who was pulling the strings behind them. Drug sales flourished in the bars.

“Extortion also grew a lot [under the cover of street vending], and everyone was saying it was the Unión Tepito,” the source explains.

At the time, Cuautla and eastern Morelos — a corridor linking the state with Guerrero and Puebla — were in a period of transition. In January 2022, local media published a photograph taken years earlier showing then-governor Cuauhtémoc Blanco, of Morena’s coalition, alongside the two leading criminal figures in eastern Morelos: Irving Solano, known as “El Profe,” and Raymundo Castro, alias “El Ray.”

Also pictured was Homero Figueroa, known as “La Tripa,” who was arrested in Puebla a few weeks ago, shortly after the politicians were arrested in May. During Blanco’s years as mayor of Cuernavaca, La Tripa worked for the city’s water and sewerage system. He and his group, the Comando Tlahuica, had discovered that water could be a lucrative business.

Their logic was simple: seize control of the administrative apparatus and collect residents’ water fees and tanker-truck sales themselves.

El gobernador de Morelos, Cuauhtémoc Blanco, con Irving Eduardo Solano, jefe de plaza del Cartel Jalisco Nueva Generación (CJNG) y Guerreros Unidos, Homero Figueroa, líder de Los Tlahuicas, y Raymundo Isidro Castro, líder asesinado del CJNG

By the time that photograph was taken, in December 2018, “El Profe was also trying to take control of the municipal slaughterhouse,” says the source cited earlier, referring to the facility where hundreds of butchers supplying Cuautla and the surrounding area slaughter livestock and purchase meat. Millions of pesos changed hands there every month.

“El Profe and El Ray had their suppliers and forced the butchers to buy from them,” he explains. “Soon after they took control of the cadastre and property tax collection area of the municipality.”

Although the photograph appeared to suggest that both criminals remained at the height of their power until 2022, their heyday had in fact ended much earlier. El Ray was arrested in 2019 and was murdered in prison later that year. El Profe was captured in 2021 and is serving a decades-long prison sentence.

After Corona left office, Rodrigo Arredondo, also from Morena, won the mayoralty of Cuautla. Barely a year into his term, El Barbas arrived on the scene from Sinaloa.

According to a report published by Reforma in late May, citing the investigation triggered by the video of the meeting with the crime boss, El Barbas teamed up with a Unión Tepito leader known as Milton. In Cuautla, the group operated under the name Gente Nueva.

But his leadership was contested, and the power vacuum left by the previous criminal order continued to generate friction. Drug dealers from the earlier era continued operating in the bars of Cuautla and the surrounding area.

“Then they started fighting with the Unión Tepito people,” the source continues.

And the disputes went beyond drug dealing: there were battles over the slaughterhouse, transport routes and extortion rackets. The result was a mounting death toll. In 2023 and 2024, Cuautla recorded more homicides than ever before.

Alfredo Lezama, councilor for youth affairs from the National Action Party, was shot in January 2024.

The overlapping layers of criminal groups operating in the region turned Cuautla into a madhouse, a criminal free-for-all. Everyone knew that Unión Tepito operatives were active there; everyone had heard of El Barbas. And everyone assumed that, in between, smaller-time criminals were also trying to get in on the action and make a profit. It became a fever: everybody wanted a piece of the pie.

A businessman from Cuautla recalls a story a police officer told him a few weeks ago.

“A patrol car came across two young men on the highway late one night. Their motorcycle had broken down. The officers stopped and searched their backpack and found two notes inside,” he says. “They were messages they were supposed to deliver to two businesses — a taco stand and a consultancy — telling them to pay protection money.”

According to the businessman, the two youths, both 17, were to be paid 500 pesos each for delivering the notes — about $27.

Extortion is the most visible consequence of the situation in Cuautla and eastern Morelos more broadly, and also the one that causes the greatest harm to ordinary people. From January to May, authorities recorded 313 victims of extortion in the municipality, according to figures from the Executive Secretariat of the National Public Security System (SESNSP), more than double the number recorded during the same period a year earlier.

The figures lend themselves to two interpretations. The first is that the crisis is enormous — worse than ever. The second is that it was already severe before, but that more victims are now coming forward. Beyond that lies another uncertainty: what impact will the severing of one tentacle of the criminal hydra have on a crime as easy to commit as extortion?

Few businesses in the municipality have escaped receiving threatening notes in recent years, messages along the lines of: “You have 15 minutes to call, or you’re fucked, you son of a bitch,” followed by a phone number.

Small scraps of paper left on a counter, in the hope that fear will compel a shopkeeper or business owner to pick up the phone, make the call and become ensnared in the web of organized crime.

The worst part is that no one really knows who is behind what — whether it is criminals embedded in local government or independent operators. Many business owners choose to pay even when they suspect the extortionists may be impostors; they can be dangerous too. Others choose to shut down altogether.

The businessman, who used to run a shop in the city center, did exactly that. The threatening note reached only his second business, but he says the city center ”had deteriorated too much.”

Imagen de uno de los papelitos que extorsionadores han dejado en comercios de Cuautla en los últimos meses.

The present

Unless El Barbas — still a fugitive — eventually proves otherwise, the latest criminal cycle in Morelos appears to have been cut short before reaching full maturity. The arrest of La Tripa effectively brought the previous one to a close; the dismantling of El Barbas’s institutional network has dealt a potentially fatal blow to this latest iteration.

The problem is that the criminal playbook is already well established. The strategy of capturing spheres of institutional power has become a standard feature of organized crime. Morelos, and eastern Morelos in particular, has also seen how this dynamic extends beyond municipal governments. One need only look at the chain of killings linked to the leadership of the Association of Users of the Cuautla River (Asurco), a farmers’ organization that has long benefited from royalties paid by the Federal Electricity Commission (CFE) for its use of the river’s water.

In February 2022, gunmen murdered Francisco Vázquez, chairman of the association’s oversight board. In 2024, Asurco’s then-president, Antonio Domínguez, survived an armed attack at his home. Domínguez, who had also served as mayor of Ayala, a municipality adjacent to Cuautla, stepped down from his position after the attack. He was succeeded by Carolina Plascencia. In September 2025, Plascencia was murdered on a highway.

The circle closed further last week with the arrest of Domínguez and a former associate from his time in Ayala — his municipal secretary. Authorities allegedly found weapons and drugs in their possession.

This sequence of events illustrates the consequences of the struggle for control of the association and its financial resources, even if important pieces of the puzzle remain missing. It is still unclear why Plascencia and Vázquez were killed, why Domínguez was targeted in the first place, or why he has now been arrested.

The senior local official familiar with the region’s shifting power dynamics over the past 15 years argues that the arrest of La Tripa — and his interests and knowledge of the regional water business — ultimately led to Domínguez’s downfall. Local media outlets in Cuautla have reported that the alleged crime boss has entered the Attorney General’s protected-witness programme, although that has not been officially confirmed.

The 2019 murder of activist Samir Flores should be viewed within the same brutal struggle for power and resources that has shaped the region. A resident of Temoac, near Cuautla, Flores belonged to the People’s Front in Defence of Land and Water, which opposed the Morelos Integral Project — a scheme involving two thermoelectric plants, a gas pipeline and an aqueduct serving the area and neighbouring states, and one that also benefited Asurco and the municipality of Cuautla financially. Despite the public outrage sparked by his killing, those who ordered it were never identified. The trial of the only suspect ended with his acquittal in March.

The difficulties in securing justice in this case, as in the others, stem not only from the systemic shortcomings of prosecutors’ offices but also from the strength of the region’s criminal networks.

“Small criminal groups have sprung up in every municipality, without exception,” says the source familiar with local politics in and around Cuautla, who has at times advised federal authorities.

In September 2025, he recalls, authorities arrested a former treasurer of Temoac, known as La Patrona or La Jefa, along with 10 members of the local criminal cell Los Aparicio, who were suspected of involvement in the Flores case. Temoac’s mayor, a relative of La Jefa, had stepped down from office months earlier after surviving an armed attack.

Una mujer grita una consigna durante la marcha. Junto a un acompañante, carga con un cartel que lleva la cara de Samir Flores, campesino y activista mexicano de etnia indígena náhuatl que se opuso a la construcción de una planta termoeléctrica en el Estado de Morelos y que fue asesinado en 2019.

Cuautla and eastern Morelos now find themselves at a crossroads. The apparent end of the most recent criminal cycles raises pressing questions about what comes next. Are new leaders already emerging, waiting only for the next leaked photograph or video to reveal themselves? Have the arrests of public officials and criminal figures achieved anything, or have they merely cleared the way for successors?

The businessman quoted earlier is not especially optimistic. His account is a catalogue of shuttered businesses and executions, of people who paid and others who chose to leave. The decay has reached the point where extortionists distribute threats as casually as advertising flyers.

“They just come and leave the notes, exactly like that,” he says.

With public life corrupted from the top down, the restoration of local institutions appears to be Cuautla’s only real path forward.

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United States Says It Will Not Renew The USMCA, The Landmark Trade Pact With Mexico And Canada

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A brief statement of barely 150 words was enough for the United States to announce that it will not renew the USMCA — the landmark trade agreement with Mexico and Canada — “in its current form.”

“However, the Agreement remains in force pending resolution of these issues or until the Agreement’s termination,” the Office of the United States Trade Representative (USTR) clarified.

Washington says it would prefer to conduct annual reviews of the pact, a strategy that threatens to unsettle markets by introducing uncertainty for businesses operating on both sides of the border. The White House’s proposed solution for companies seeking to eliminate that uncertainty is to invest in the United States — an approach seen as an exercise in economic nationalism.

“The United States will continue to engage with Mexico and Canada to address the Agreement’s shortcomings and our trade deficits with these countries,” the department headed by Jamieson Greer said in the statement. “As previously announced, the United States will meet with Mexico during the week of July 20 for a third round of bilateral negotiations related to the joint review of the USMCA.”

The news broke on Wednesday, July 1, as the deadline for the USMCA review expired. The three countries’ trade representatives — Jamieson Greer for the United States, Mexico’s Economy Minister Marcelo Ebrard, and Canada’s Dominic LeBlanc — held a virtual meeting to discuss the implementation of the agreement, the extension of the review period and the next steps for the pact.

Following the announcement by Greer, who has gained influence within Trump’s inner circle, optimism in Mexico began to fade. Speaking shortly after the videoconference, Ebrard said Mexico still had room to preserve the North American trade relationship.

“The United States is not in a position to extend the agreement for another 16 years. We are going to move forward under the annual-review track for the next 10 years, which is the remaining term of the agreement.”

“We are not in a hurry, but neither do we want uncertainty, and that is why we need to reach agreement on a number of issues,” the Mexican official said in a short video posted on social media.

Ebrard argued that the annual reviews would allow the three partners to address outstanding disputes and concerns on an ongoing basis. “The United States believes it has lost jobs, particularly in some manufacturing sectors, and the issue of the trade deficit remains pending,” he acknowledged, citing some of the key issues in negotiations with the Trump administration.

Before the call, Mexican President Claudia Sheinbaum stressed that the USMCA remains highly beneficial to the United States.

“The agreement benefits the United States because it helps lower the price of goods,” she said during her morning press conference.

Sheinbaum also highlighted the importance of regional unity and the strength of North America as an economic bloc in relation to global competitors.

“As North America, the three countries together can compete more effectively against other regions of the world,” she added.

Tariffs changed the relationship

A senior Commerce Department official explained that trade relations between the United States and the rest of the world shifted last year when Donald Trump decided to impose unilateral tariffs.

“Our trade deficit with Canada has fallen by roughly a quarter over the past year and a half. Trade with Mexico has increased significantly because of the impact of our tariffs on the rest of the world, with many supply chains returning to the United States,” the official said.

“To some extent, the agreement is subordinate to the president’s robust trade policy,” U.S. officials added.

While trilateral negotiations continue, the trade agreement will remain in force for another decade unless the United States or one of the other signatories decides to withdraw. Instead of scheduled reviews every six years, the pact will now be reviewed annually, opening the door to potentially contentious negotiations every year and creating uncertainty for supply chains across North America.

The automotive industry is watching developments closely, as it is among the sectors most exposed to the agreement, with manufacturing and assembly plants spread across all three countries.

The senior U.S. official also highlighted the differing nature of Washington’s negotiations with Mexico and Canada. While talks with Claudia Sheinbaum’s government are progressing smoothly, U.S. authorities say they have encountered greater obstacles with Canada.

“Mexico has been very constructive throughout this process. It has put forward proposals to reduce the trade deficit, so we have been engaged in formal bilateral negotiations with Mexico to address and resolve a number of bilateral issues,” the official said, suggesting that discussions may increasingly be conducted on a bilateral basis with both its northern and southern neighbors.

Bilateral relations

“Canada is in a different position. Along with China, it was one of the few countries in the world to retaliate against the United States following the president’s landmark trade measures aimed at reducing the U.S. trade deficit and bringing manufacturing back home. Nor has it addressed many of the non-tariff barriers and trade challenges that have persisted in recent years,” the senior U.S. official with knowledge of the negotiations.

Canada’s representative, Dominic LeBlanc, offered his assessment of the meeting in a statement: “We agreed on the importance of continuing our discussions and identifying ways to ensure trade and investment frameworks between Canada, the United States and Mexico continue to support North American prosperity and competitiveness. For Canada, this includes substantive discussions with the United States on addressing sectoral tariffs on Canadian steel, aluminum, autos and lumber.”

LeBlanc said Canada remained “in a position of strength” to preserve and strengthen the USMCA. “At a time of global economic uncertainty, Canada is a stable, reliable and trusted partner. We have the energy and natural resources the world needs, a world-class workforce, and a predictable business environment attracting the highest investment in decades,” he said in the statement.

In force since 2020

The United States-Mexico-Canada Agreement was signed during Donald Trump’s first term and entered into force in 2020, but it included a review clause beginning on July 1 this year. At the time, Trump described it as “the best agreement we’ve ever made.”

The agreement has a 16-year lifespan, running until 2036, although any of the three countries can withdraw with three months’ notice. The USMCA governs nearly $2 trillion in annual trade among the three partners and replaced the North American Free Trade Agreement (NAFTA), which had been in force since the 1990s.

Since the three North American countries signed their first trade pact, their economic ties have deepened significantly, creating highly integrated supply chains in sectors such as automotive manufacturing and many others across the continent. The millions of jobs tied to that integration would be difficult to disentangle.

Even so, Washington has not ruled out formally withdrawing from the agreement, a move that would require six months’ notice.

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