Mexico
A Woman With a Plan: Claudia Sheinbaum’s Plan México
Mexico’s economy presents a striking contrast: While GDP growth has slowed since the post-pandemic rebound, exports are at record highs, poverty has declined, and trade balances have improved. The chemical sector, however, faces persistent challenges. ANIQ reported a 2024 trade deficit of US$24.6 billion, with production still below 2018 levels and asset utilization dropping from 77.1% to 63.4% over the same period. GDP contribution has fallen 0.4 points, and with 57.8% of exports tied to the US – an increasingly unpredictable partner – the sector must navigate uncertainty while seeking opportunities for diversification and growth.
Yet, among executives, the impression – despite challenges affecting the industry globally and the disappointing figures above – is that Mexico finds itself at a moment of opportunity. Miguel Benedetto, executive director of ANIQ, reflected: “Despite recent challenges, chemicals remain among the three most important sectors in Mexico with an impressive investment potential estimated at US$45 billion over the next 15 years.”
Mexican president Claudia Sheinbaum’s Plan México underlines the country’s proposed investment potential. Elected in a landslide in 2024, Sheinbaum introduced the Plan in January 2025 as her administration’s flagship development roadmap. Ambitious goals include moving Mexico from the 12th to the 10th largest economy globally, creating 1.5 million new jobs, and expanding domestic manufacturing so that 50% of consumption is ‘Made in Mexico’ by 2030.
The petrochemical and chemical industry is one of the Plan’s strategic pillars. Plan México explicitly aims to grow exports in chemicals, pharmaceuticals, aerospace, and electronics to 15% of global totals, while reinforcing R&D. Martín Toscano, president for Mexico at specialty chemical manufacturer Evonik, emphasized the sector’s importance: “The chemical industry is central to Mexico’s nearshoring strategy and long-term competitiveness. Without a strong chemical base, manufacturing value chains cannot fully develop, making the sector essential to President Sheinbaum’s Plan México.”
Another of the Plan’s key targets is Mexico’s energy self-sufficiency. It calls for a 30% fuel production boost from 2025 to 2030, while reducing dependency on imported natural gas. This will serve as a crucial input to another goal – to increase national production of petrochemicals and fertilizers. “Increasing gas and oil production to secure a sufficient feedstock supply is imperative to stimulate industry growth,” argued ANIQ’s Bennedetto.
With hopes of providing greater investor certainty, the Mexican government is drafting a new Hydrocarbons Law. Bennedetto welcomed the effort: “A clear legal framework for investments is essential, with the Hydrocarbons Law and its regulations being fundamental to provide the necessary legal security to promote investments in the sector and achieve the objectives established for the petrochemical sector in Plan México.”
Others, however, remain sceptical, calling for refinement. They warn new regulations risk placing hurdles in front of sector development: “Overlapping rules create complexity. The Hydrocarbons Law treats all petrochemicals as O&G products. It introduces additional requirements, including registration of all clients, transporters and warehouses, special permits, and letters of intent for purchases and sales, potentially halting imports,” argued Francisco Martínez, managing director for Mexico at distributor GreenChem.
Mexico’s chemical sector stands at a crossroads: persistent deficits and inefficiencies contrast with vast investment potential. The industry’s revival will hinge on turning lofty policy ambitions into lasting structural gains.
Solving the Pemex problem
Pemex’s financial and operational struggles cast a long shadow over Mexico’s petrochemical sector. Mounting debt, underperforming refineries, corruption investigations, and rising fuel theft have reduced domestic feedstock supply and increased electricity costs. Pemex’s own chemical output has fallen dramatically – from 9 million t/y in 2010 to 2.5 million t/y in 2024 – inevitably resulting in higher prices, lower margins, and growing reliance on imports.
Reviving Pemex will require substantial investment in aging production and transport infrastructure. The government plans spending around US$975 million to boost ethylene and polyethylene output, cutting US$14 billion in imports, while modernizing plants like Lázaro Cárdenas and Salina Cruz and building new facilities, including a coker in Tula. Complementing this, a US$8 billion investment will expand over 3,000 km of railways to enhance freight transport and supply chain efficiency.
Beyond pure government investment, public-private partnerships may be leveraged under Plan México’s actions in order to source more funding and expertise for Pemex’s restoration. “Plan México establishes roadmaps for public-private collaboration concerning Pemex, the details of which we are actively discussing with the authorities. We have long advocated for new infrastructure development, which is a central component of the Plan,” outlined ANIQ’s Bennedetto.
Evonik’s Toscano added: “Private collaboration with the public sector, including Pemex, will help reactivate petrochemical assets, ensuring a sustainable, competitive platform and securing Mexico’s position as a key manufacturing and export hub in global supply chains.”
The desire among stakeholders to see Pemex return to its role as a key vector for Mexican industrial development and sovereignty, much in line with Plan México’s aims, is clear. Of course, Pemex is not the only player here – private investment is also reshaping Mexico’s petrochemical players. Braskem Idesa and Advario’s Puerto México terminal boosts polyethylene production by handling 80,000 barrels/day of ethane, mitigating feedstock shortages. “Our plant is ready to operate at full capacity, reaching an annual production of up to 1.05 million tons of polyethylene. This also drives the growth of Mexico’s polyethylene market, contributing to import substitution, securing supply, and consolidating the country’s petrochemical value chain,” commented Braskem Idesa CEO Isabel Figueredo.
Meanwhile, Proman GPO’s Topolobampo complex, set for 2027, will supply 2,200 t/d of anhydrous ammonia – covering 70% of national demand – and plans to add methanol production. These projects demonstrate how private initiatives are modernizing infrastructure, enhancing self-sufficiency, and creating long-term growth opportunities in the sector.
“Mexico has benefited from US trade policies, even under President Trump, and I remain optimistic regarding a renegotiation of the USMCA: Any disruption is likely limited, as Mexico imports more chemicals than it exports to the U.S.”
Francisco Martínez, Managing Director Mexico, GreenChem Industries
Keep your friends close
Mexico’s deep commercial ties with the US, perhaps unsurprisingly, were a recurring theme in GBR’s interviews. In March 2025, the Trump administration imposed 25% tariffs on non-USMCA goods imports from Mexico, citing concerns over fentanyl and irregular immigration, with threats of further increases. Some view Mexico’s dependence on the US as a risk. Others remain optimistic, confident in ongoing progress and the enduring potential of nearshoring. Moreover, any replacement of the US would be enormously challenging. Decades of integrated trade, supply chains, and infrastructure demand a pragmatic approach. “For three decades, Mexico has developed trade relationships, infrastructure, and supply chains designed to strengthen links with the US and Canada. Our priority is to maintain this framework while remaining open to exploring new partnerships,” said ANIQ’s Bennedetto.
Indeed, any substantial move away from US trade would be mutually harmful for business on both sides of the border. “Shifting production closer to US markets has created advantages in lead times and logistics costs, particularly compared to Asia. Despite new tariffs, Mexico’s competitive cost structure and skilled workforce remain valuable,” noted Jorge Buckup, major distributor Univar Solutions’ president for Latin America.
So far, Mexico’s government is taking a pragmatic approach. Ahead of USMCA renegotiations set for 2026, industry insiders in Mexico were positive about the potential for a win-win outcome. “I remain optimistic regarding the upcoming renegotiation of the USMCA. Any disruption will likely be limited, as Mexico imports more chemicals than it exports to the US,” commented GreenChem’s Francisco Martínez, affirming that the Sheinbaum administration’s effective diplomacy was working to Mexico’s benefit.
Evonik’s Martín Toscano also saw potential for a balanced path ahead: “USMCA negotiations should soon provide greater clarity on Mexico’s role within North America, while also allowing Mexico to expand opportunities in Europe and other regions.”
That opportunity for diversification of Mexico’s trading relationships remains tempting. “Mexico benefits from being a very open economy with access to both the Atlantic and Pacific, facilitating trade with Europe, Asia and Africa,” assessed Simone de Faria, market intelligence firm Townsend Solutions’ head of Latin America.
Mexico’s geographic location, low labor costs and strong chemical sector create a natural advantage for diversifying trade, especially in Latin America and other global markets.
Ultimately, though, what the sector wants is clarity. “Mexican imports of chemicals, plastics, and most finished goods are exempt from tariffs by the USMCA agreement. The key will be which products are included in the exemption lists,” affirmed Jesse Tijerina, S&P Global Commodity Insights’ chemicals lead.
Herminio Muchon, Latin America sales manager at chemical producer Huntsman, highlighted the impacts of uncertainty: “Nearshoring expectations have faced setbacks. Some customers’ projects have been paused due to sensitivity around tariffs. Mexico and the US have engaged in constructive discussions. This ongoing dialogue is crucial, given the strong economic interdependence between the US and Mexico.”
Mexico’s path hinges on managing interdependence with the US while exploring new markets. Success will depend on clarity, stable negotiations, and diplomacy, ensuring that nearshoring benefits are realized without undermining existing strengths.