EL PASO, Texas (Border Report) – Minutes before Claudia Sheinbaum took the oath of office on Monday, Tony Payan reflected on the challenges awaiting Mexico’s new president. “Congratulations. You won the raffle; you won the tiger. Now you take it home and deal with it,” said Payan, the director of the Center for the U.S. and Mexico at Rice University’s Baker Institute for Public Policy. Claudia Sheinbaum sworn in as 1st female president of Mexico Sheinbaum is inheriting a politically polarized country where the outgoing president has committed a large portion of the treasury to welfare programs and controversial infrastructure projects for years to come, he said. The first female president in Mexican history also must deal with a state-run oil company $100 billion in the red, misgivings from foreign investors over recent constitutional changes and pressure from the United States to help curb migration and stamp out illicit fentanyl exports. Tony Payan “She inherits several ticking time bombs. The security situation in Mexico is unlike anything we’ve seen before,” Payan said. “Organized crime runs rampant throughout the country and govern vast swaths of Mexican countryside and economic activities and victimize people with impunity. Rare ‘liger’ rescued from abandoned home near US border “She also is inheriting a stalled economy, mounting liabilities given the social cash-transfer programs (former President Andres Manuel) Lopez Obrador established. She is in very tight fiscal position.” An American credit rating agency in June said Mexico has a fiscal deficit equivalent to 5 percent of its gross domestic product – the highest in more than 30 years. “The challenging fiscal position inherited by the incoming administration follows a combination of rising social spending, higher borrowing costs and high investment due to the completion of priority infrastructure projects of the outgoing administration,” Fitch Ratings reported. Payan and others also question how far Sheinbaum will stray from Lopez Obrador’s policies. The leaders of the ruling MORENA Party, including his son Andres Manuel Lopez Beltran, still see him as their standard-bearer, he said. “We don’t really know who Claudia Sheinbaum is. She has lived in the shadow of Lopez Obrador. He was her mentor, he handpicked her to be his successor, and he trained her for the role and worked very hard to get her elected,” Payan said. “What that means is she is very committed to him, his programs, his ideology and his projects. She has shown no inclination to depart from his policies.” Sheinbaum doubles down on AMLO’s populist legacy Wearing a white dress with embroidery on one side with three female army cadets in the background, Claudia Sheinbaum took to the podium of the Mexican Congress chamber on Monday to be sworn in as Mexico’s first woman president. In a soft but steady voice, she often quoted Mexico’s Indigenous President Benito Juarez on the principles of equality and self-determination. “You cannot have a rich government when the people are poor,” she said. “We want peace and cooperation with other countries but will not submit. […] We condemn racism, classism and machismo. We don’t just tolerate but recognize that inequality means injustice.” When she got down to business, she vowed to not just continue but expand her predecessor’s novel welfare programs. Those over 65, the disabled and women between 60 and 64 years will get a monthly stipend, high school students will get scholarships and young adults will be eligible for a new rent-to-own home program. “All welfare programs will be kept in place, and we will make sure the annual increase is never below the inflation level. Congress will make this law so no one can revert them in the future,” Sheinbaum said in her inaugural address. “We will not increase gas or electricity prices. We will meet with business leaders to keep prices as they are. […] We will work with employers and workers, so the minimum wage grows to 2.5 times basic necessities.” She vowed to hire 20,000 additional government doctors and nurses for government clinics, open more high schools and welfare offices throughout Mexico in coming years. But, as her critics warned, she committed to continue building train tracks for the Maya Train project – more than 1,000 miles of new rail lines – in nature-rich southern states such as Chiapas. She said she would restrict oil production at PEMEX to 1.8 million barrels of crude per day. That’s not so much a voluntary reduction in carbon fuel production as the tapping out of Mexican oil field production. Reuters reported last week that PEMEX production for August was 1.77 million barrels per day. State oil company officials blamed the production fall on the natural aging of its flagship oil fields in Tabasco state and the Mexican Gulf Coast. Sheinbaum also sought to reassure investors that her party’s controversial judicial reform – in which judges will be elected instead of screened, appointed and confirmed – will not erode democracy, but strengthen it. “There will be a state of law,” she said. An environmental scientist prior to her political career, Sheinbaum said her government would continue to produce 54 percent of the country’s energy and cut in private investors to the other 46 percent. She said new water recycling plants would be built near Mexico City and that she would come up with a water sustainability plan shortly that includes remediation of polluted rivers. Sheinbaum also flashed generalities about a new public safety plan. It includes addressing the root causes of crime such as lack of opportunities for young people, more resources for investigations, more coordination with state police departments and further strengthening the National Guard, which is now under the Ministry of Defense. She mentioned little about migration, but experts expect the current crackdown on migrant caravans and unauthorized train riders to continue. 'No policy on border affairs' Thor Salayandia, board member of the Mexican Chamber of Industry and leader of the Border Entrepreneurial Front, said he is concerned about the new administration listening to the needs of the border. “We have mediocre economic growth, and we are a very polarized country,” he said. “Productivity is down, and labor costs are up. Small businesses are struggling and there is no will to help national industry grow. The government continues to depend on foreign investment and there is no coherent policy toward the border.” Thomas M. Fullerton, professor of economics and finance at the University of Texas at El Paso, agreed that Lopez Obrador left a lot of “hidden financial responsibilities” for Sheinbaum. "Lopez Obrador embarked on a lot of ill-advised schemes. He built a new airport rather than expand an old one. Nobody is using it and has to be subsidized. The Maya Train is going to require subsidies in order to survive. Pemex was mismanaged under (Lopez Obrador) and also requires subsidies," he said. “(Sheinbaum) will have to cut back on expenditures or increase revenues somehow. Neither option will be easy to implement. Mexico is now facing a risk of substantial ramp-up in inflation due to deficit spending." Another possible pitfall for the president is she has been advocating for closer ties to China and Russia at a time the United States is at odds with those countries and the U.S.-Mexico-Canada trade agreement (USMCA) is due for a review in two years. “She runs the risk of alienating Washington, D.C., and Ottawa. We’ll see what happens in 2026. It’s possible things can get derailed there, and if that happens, it will hurt Mexico’s ability to compete internationally,” Fullerton said. Salayandia said that “it’s good the elderly are getting aid,” but questioned where the money is coming from in a developing country with limited resources. “If we were to be pessimistic, we’d see ourselves becoming Venezuela. If we want to be realistic, we are looking at six years of economic (stagnation). If we dare to be optimistic, we see Sheinbaum distancing herself from Lopez Obrador and create programs that will really help Mexican industry develop and create jobs instead of shedding them,” he said. Visit the BorderReport.com homepage for the latest exclusive stories and breaking news about issues along the U.S.-Mexico border Salayandia added that border entrepreneurs are hoping to meet with Sheinbaum and that she will listen to their concerns.