Mexican President-elect Claudia Sheinbaum’s strong environmental credentials mean that a shift away from fossil fuels and towards renewables is likely during her tenure. We doubt that she’ll fully open up the energy sector to private investment and think that the state will play a key role in the green transition. But fiscal realities might constrain Sheinbaum’s ability to push through her green agenda and to carry out the necessary investments to improve Mexico’s energy infrastructure. This not only poses a risk to domestic manufacturing but could also hamper Mexico’s nearshoring prospects.
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