# Mexico and the 112th Congress

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/crs%3ARL32724

## Record

- **Collection:** Congressional research report
- **Document type:** CRS Report
- **Published:** January 29, 2013
- **Citation:** RL32724

## Text

Mexico and the 112th Congress
(name redacted)
Specialist in Latin American Affairs
January 29, 2013

Congressional Research Service
7-....
www.crs.gov
RL32724

CRS Report for Congress
Prepared for Members and Committees of Congress

Mexico and the 112th Congress

Summary
The United States and Mexico have a close and complex bilateral relationship as neighbors and
partners under the North American Free Trade Agreement (NAFTA). Although security issues
have recently dominated the U.S. relationship with Mexico, analysts predict that bilateral
relations may shift toward economic matters now that President Enrique Peña Nieto has taken
office. Peña Nieto of the Institutional Revolutionary Party (PRI) defeated leftist Party of the
Democratic Revolution (PRD) candidate Andrés Manuel López Obrador and Josefina Vázquez
Mota of the conservative National Action Party (PAN) in Mexico’s July 1, 2012 presidential
election. As a result, the PRI, which controlled Mexico from 1929 to 2000, retook the presidency
on December 1, 2012. Some analysts have raised concerns regarding the PRI’s return to power,
but President Peña Nieto has pledged to govern democratically and to forge cross-party alliances.
The outgoing PAN government of Felipe Calderón pursued an aggressive anticrime strategy and
increased security cooperation with the United States. Those efforts helped Mexico arrest or kill
record numbers of drug kingpins, but 60,000 people may have died as a result of organized crimerelated violence during the Calderón Administration. Mexico’s ongoing security challenges
overshadowed some of the Calderón government’s achievements, including its successful
economic stewardship during and after the global financial crisis.
U.S. Policy
In recent years, U.S. policy toward Mexico has been framed by security cooperation under the
Mérida Initiative. Congress has provided more than $1.9 billion in Mérida aid since FY2008 to
support Mexico’s efforts against drug trafficking and organized crime. Whereas U.S. assistance
initially focused on training and equipping Mexican counterdrug forces, it now prioritizes
strengthening the rule of law. Along the border, U.S. policymakers have sought to balance
security and commercial concerns. The U.S. and Mexican governments resolved a long-standing
trade dispute in 2011 involving NAFTA trucking provisions and have sought to improve
competitiveness through regulatory cooperation. Bilateral trade surpassed $460 billion in
2011.The February 2012 signing of a Trans-Boundary Hydrocarbons Agreement for managing oil
resources in the Gulf of Mexico could create new opportunities for energy cooperation.
Legislative Action
The 112th Congress maintained an active interest in Mexico. The Obama Administration asked for
$269.5 million in assistance for Mexico in its FY2013 budget request. The Senate and House
Appropriations Committees’ versions of the FY2013 foreign aid measure, S. 3241 and H.R. 5857,
each recommend increases in aid to Mexico, with human rights conditions similar to P.L. 112-74.
Congress held oversight hearings, issued reports, and introduced legislation on how to bolster the
Mérida Initiative and on related U.S. domestic efforts to combat gun trafficking, money
laundering, and drug demand.
Violence in northern Mexico has kept border security on the agenda, with P.L. 112-93 increasing
penalties for aviation smuggling, P.L. 112-127 tightening sentencing guidelines for building
border tunnels, and P.L. 112-205 providing statutory authority for the bilateral Border
Enforcement Security Task Force (BEST) program.

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Mexico and the 112th Congress

Mexico’s recent accession to negotiations for a Trans-Pacific Partnership (TPP) trade agreement
generated congressional interest. Congressional consideration of the Trans-boundary
Hydrocarbons Agreement did not occur.
This report reflects legislative developments during the 112th Congress. It will not be updated.
Also see: CRS Report R42917, Mexico’s New Administration: Priorities and Key Issues in U.S.Mexican Relations, by (name redacted); CRS Report R41349,
U.S.-Mexican Security
Cooperation: The Mérida Initiative and Beyond, by (name redacted) and Kristin M.
Finklea; and CRS Report RL32934, U.S.-Mexico Economic Relations: Trends, Issues, and
Implications, by (name redacted).

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Contents
Background on Mexico.................................................................................................................... 1
Political Developments During the Calderón Administration ................................................... 2
July 1, 2012, Elections: Outcome and Political Transition ........................................................ 3
Drug Trafficking and Heightened Violence and Crime in Mexico ............................................ 5
Economic Conditions ................................................................................................................ 7
Social Conditions....................................................................................................................... 8
Foreign Policy ......................................................................................................................... 10
Mexican-U.S. Relations: Issues for Congress................................................................................ 10
U.S. Assistance to Mexico ....................................................................................................... 12
Merida Initiative ................................................................................................................ 12
Non-Merida Assistance Programs ..................................................................................... 14
Department of Defense Support to Mexico....................................................................... 14
Bilateral Cooperation on Counternarcotics and Security Efforts ............................................ 15
Overview of Related Southwest Border Initiatives ........................................................... 15
Money Laundering and Bulk Cash Smuggling ................................................................. 17
Firearms Trafficking .......................................................................................................... 19
Alien Smuggling and Human Trafficking ......................................................................... 20
Human Rights .......................................................................................................................... 21
Conditions and Mexican Efforts to Improve ..................................................................... 21
Human Rights Conditions on U.S. Assistance to Mexico ................................................. 24
Migration ................................................................................................................................. 26
Trends in Mexican Immigration to the United States........................................................ 26
Mexico’s Immigration Policies ......................................................................................... 26
Efforts to Enact Immigration Reform in the United States ............................................... 28
Energy and Environmental Issues ........................................................................................... 29
Oil Production in Mexico and Efforts to Reform PEMEX ............................................... 29
U.S.-Mexican Energy and Environmental Cooperation .................................................... 30
United States-Mexico Trans-Boundary Hydrocarbons Agreement ................................... 31
Trade Issues ............................................................................................................................. 32
Functioning of NAFTA Institutions .................................................................................. 32
Trade Disputes and Emerging Trade Issues ...................................................................... 33
Proposed Trans-Pacific Partnership (TPP) Agreement...................................................... 34
Legislation Enacted in the 112th Congress ..................................................................................... 35

Figures
Figure 1. Map of Mexico, Including States and Border Cities ........................................................ 1
Figure 2. Mexico’s 2012 Gubernatorial Election Results ................................................................ 4

Tables
Table 1. U.S. Assistance to Mexico by Account, FY2007-FY2013............................................... 12

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Table 2. FY2008-FY2013 Mérida Funding for Mexico by Aid Account and
Appropriations Measure ............................................................................................................. 13

Contacts
Author Contact Information........................................................................................................... 36
Key Policy Staff ............................................................................................................................. 37
Acknowledgments ......................................................................................................................... 37

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Background on Mexico
Over the past two decades, Mexico has transitioned from a centralized political system dominated
by the Institutional Revolutionary Party (PRI) to a true multiparty democracy. Since the PRI last
governed in the 1990s, presidential power has become increasingly constrained by Mexico’s
Congress, its Supreme Court, and increasingly powerful governors.1 Partially as a result of those
constraints, two successive National Action Party (PAN) administrations struggled to enact the
structural reforms needed to boost Mexico’s economic competitiveness and effectively address
the country’s security challenges. Weak institutions remain an impediment to democratic
consolidation in Mexico.
Figure 1. Map of Mexico, Including States and Border Cities

Source: Map Resources, adapted by CRS.

1

For background, see Andrew Selee and Jacqueline Peschard, eds., Mexico’s Democratic Challenges: Politics,
Government, and Society (Stanford, CA: Stanford University Press, 2010).

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Political Developments During the Calderón Administration
Felipe Calderón of the conservative PAN won the July 2006 presidential election in an extremely
tight race, defeating Andrés Manuel López Obrador of the leftist Party of the Democratic
Revolution (PRD) by fewer than 234,000 votes. President Calderón began his six- year term on
December 1, 2006; his term concluded on November 30, 2012. Calderón was succeeded by
Enrique Peña Nieto of the Institutional Revolutionary Party (PRI).
The serious economic and security challenges that Mexico has faced over the last few years have
overshadowed the policy achievements of the Calderón Administration.2 Despite taking office in
a relatively weak position after a disputed election, Calderón shepherded some significant
reforms through the Mexican Congress in the beginning and end of his term, including historic
labor reforms enacted in November 2012. The Calderón government maintained macroeconomic
stability amidst an unstable global economy, expanded access to health insurance, and started to
reform Mexico’s federal security apparatus. Mexico-U.S. relations grew stronger through
cooperation under the Mérida Initiative, as did Mexico’s relations with Latin America.
Nevertheless, Mexico experienced an unprecedented security crisis that occurred, at least in part,
because of the government’s campaign against organized crime. Escalating violence, persistent
poverty and joblessness, and lingering corruption and impunity caused Calderón’s popularity to
decline and prompted some negative assessments of his presidency.3
In the first half of his term, President Calderón, whose PAN became the largest party in the
Senate and Chamber of Deputies after the 2006 legislative elections, had some success in turning
to the PRI for help in advancing his legislative agenda. In 2007, he secured passage of longawaited fiscal and pension reforms that had stalled under the PAN Administration of Vicente Fox
(2000-2006). In June 2008, President Calderón signed a judicial reform decree after securing the
approval of Congress and Mexico’s states for an amendment to Mexico’s Constitution. Under the
judicial reform, Mexico will have until 2016 to move from a closed door process based on written
arguments to a public trial system with oral arguments and the presumption of innocence. In
October 2008, the government secured approval of an energy sector reform designed to improve
the transparency and management flexibility of state oil company Petróleos Mexicanos
(PEMEX). Critics maintained that the law, which provided only limited opportunities for private
partnerships with the company, would not do enough to encourage new oil exploration.4
Mexico held mid-term elections in July 2009. The PRI performed even better in those elections
than polls had suggested it would, capturing a plurality of seats in the Chamber of Deputies and
five of six governorships. Analysts attributed the PRI’s strong performance to growing popular
concern about the country’s economic downturn, as well as the party’s effective use of its still
formidable national machinery. Although President Calderón remained popular, the PAN lost
seats in the Chamber and two key governorships, with voters expressing frustration with the
party’s failure to distinguish itself from the PRI. (The PAN still controlled the Senate, however.)
The PRD fared even worse than the PAN, as internal divisions led López Obrador to throw his
support behind left-leaning candidates from smaller parties, many of whom won.
2

This paragraph draws from: Pamela K. Starr, “Mexico’s Big, Inherited Challenges,’ Current History, February 2012.
See, for example, Adriana Gomez Licon and Katherine Corcoran, “Violence Tops Results of Mexico’s 5-yr Drug
War,” Associated Press, December 10, 2011.
4
Alexandra Olson, “Mexico Approves Oil Reform Bill in General Terms, Experts Call it Disappointment for
Investors,” AP, October 28, 2008.
3

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The composition of the Chamber of Deputies sworn in on September 1, 2009 complicated
President Calderon’s legislative agenda, which had included enacting a package of
comprehensive political reforms.5 The PRI, with the support of the allied Green Ecological Party
(PVEM) party, controlled a majority in the Chamber and proved reluctant to enact legislation that
could have cost the party votes in the 2012 elections. Reforms to the national security law, labor
reforms to regulate unions, and anti-money laundering legislation that had passed the Senate
remained pending in the Chamber. Several presidential initiatives did not pass either body,
including a law to reorganize municipal and state police and a reform of the federal criminal
procedures code necessary for the 2008 judicial reforms to advance. During its three-year term,
the Congress did enact antitrust legislation, an immigration law giving migrants (including illegal
migrants) increased human rights protections, constitutional reforms on human rights, and some
limited political reforms.6

July 1, 2012, Elections: Outcome and Political Transition7
On July 1, 2012, Mexico held federal (presidential and legislative) and state elections in 14 states.
Voter turnout reached record levels as 63% of eligible voters cast ballots in the election. Mexico’s
Federal Electoral Institute (IFE) conducted the elections with the oversight of the Federal
Electoral Tribunal, which officially certified the election results on August 31, 2012, after
dismissing evidence presented by the PRD-led coalition that vote-buying tainted the results.
While PRD leaders initially criticized the Tribunal’s decision, they and the other leftist parties in
their coalition later pledged to abide by its decision. In contrast, López Obrador refused to
recognize the election results and left the PRD in order to turn his Morena (Movement for
National Regeneration) social movement into a political party.
As predicted, the PRI that governed Mexico from 1929 to 2000 retook the presidency after 12
years of rule by the PAN and won a plurality (but not a majority) in the Senate and Chamber of
Deputies. PRI/PVEM candidate Enrique Peña Nieto, a former governor of the state of Mexico,
won the presidential election, albeit by a smaller margin than polls had forecast. Peña Nieto
captured 38.2% of the vote, followed by Andrés Manuel López Obrador of the PRD with 31.6%,
Josefina Vázquez Mota of the PAN with 25.4%, and Gabriel Quadri of the National Alliance
Party (PANAL) with 2.3%. Peña Nieto vowed to lead a “new PRI” government free from the
corruption that characterized the party in the past and ready to enact bold reforms.
The PRI/PVEM failed to capture a majority in either chamber of the legislature that began its
three-year term on September 1, 2012, which could complicate President Peña Nieto’s ability to
enact legislation. The PRI/PVEM could achieve a simple majority in the Chamber of Deputies by
aligning with its former ally, the PANAL, a small party affiliated with the Mexican teachers’
union. However, for legislation to pass the Senate, and for any measures to amend the
5

Those reforms, submitted to Congress in December 2009, included proposals to allow re-election of federal legislators
and mayors, reduce the size of the Senate and Chamber of Deputies, permit independent candidates for political office,
and give the president a line-item veto.
6
The political reform that President Calderón signed into law in August 2012 amends the constitution to allow for,
among other things, popular referendums on certain topics, independent candidates to run for office beginning in 2015,
and presidents to submit two legislative proposals for fast-track consideration each session.
7
For more detail on the elections, see: CRS Report R42548, Mexico’s 2012 Elections, by (name redacted). For
information on the Peña Nieto Administration, see: CRS Report R42917, Mexico’s New Administration: Priorities and
Key Issues in U.S.-Mexican Relations, by (name redacted).

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constitution (which require a two-thirds majority), the PRI will have to form cross-party
coalitions. The PRI will most likely find support from the PAN, which lost seats in the Chamber
but retained a powerful bargaining position. PAN leaders in the Congress have pledged to support
aspects of Peña Nieto’s reform agenda that they believe are in the best interest of the country,
even proposals blocked by the PRI in the last Congress. The PRD-led coalition, which now has
more seats in the Chamber than the PAN and remains the third-largest force in the Senate, could
complicate some reform efforts, including those aimed at increasing private participation in the
energy sector, a key priority for Peña Nieto.
Although President Peña Nieto’s government may encounter the same type of legislative
opposition to his agenda that President Calderón encountered, he may be able to draw upon the
PRI’s formidable strength at the state and local level to garner support for his policies. Prior to the
2012 elections, the PRI controlled 19 of 32 governorships in Mexico. As depicted in Figure 2
below, the PRI picked up the governorship of Jalisco and Chiapas, but lost the state of Tabasco.
On the contrary, should Peña Nieto’s national agenda reform run counter to state interests, he
could have to choose between maintaining party unity and challenging PRI governors.
Figure 2. Mexico’s 2012 Gubernatorial Election Results

Source: Mexico’s Federal Electoral Institute.

Mexico has an unusually long five-month transition period from one presidency to the next,
which can prove awkward for the outgoing and incoming Administrations. Between September
and November 2012, however, there appeared to be some communication between the outgoing
Calderón government and Enrique Peña Nieto’s transition team. Outgoing President Calderón
introduced labor reform legislation that the Mexican Congress approved under new fast-track
provisions in November 2012, which had also been endorsed by President-elect Peña Nieto.

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On December 1, 2012, President Peña Nieto took office for a six-year presidential term.8 Upon
his inauguration, Peña Nieto announced a reform agenda with specific proposals under five broad
pillars: reducing violence; combating poverty; boosting economic growth; reforming education;
and fostering social responsibility. Somewhat surprisingly, leaders from the conservative PAN
and leftist PRD signed on to President Peña Nieto’s “Pact for Mexico” agreement containing
legislative proposals for advancing that reform agenda. While some opposition legislators have
since balked at their leaders’ decisions to endorse the PRI-led pact, the Congress already
approved an education reform bill, one of the 13 proposals based on the pact that Peña Nieto had
identified as short-term priorities.

Drug Trafficking and Heightened Violence and Crime in Mexico9
Mexico is a major producer and supplier to the U.S. market of heroin, methamphetamine, and
marijuana and the major transit country for more than 95% of the cocaine sold in the United
States.10 Mexico is also a consumer of illicit drugs, particularly in northern states where criminal
organizations have been paying their workers in product rather than in cash. The prevalence of
illicit drug use in Mexico increased from 2002 to 2008, and then remained relatively level from
2008 to 2011.11 According to the 2011 National Drug Threat Assessment, Mexican drug
trafficking organizations (DTOs) and their affiliates “dominate the supply and wholesale
distribution of most illicit drugs in the United States.”12
In the past few years, the violence and brutality of the Mexican DTOs have escalated as they have
battled for control of lucrative drug trafficking routes into the United States and local drug
distribution networks in Mexico. U.S. and Mexican officials now often refer to the DTOs as
transnational criminal organizations (TCOs) since they have increasingly branched out into other
criminal activities, including human trafficking, kidnapping, armed robbery, and extortion. From
2007-2011, kidnapping and violent vehicular thefts increased at even faster annual rates than
overall homicides in Mexico.13 The expanding techniques used by the DTOs, which have
included the use of car bombs and grenades have led some scholars to liken DTOs’ tactics to
those of armed insurgencies.
The Calderón Administration made combating drug trafficking and organized crime its top
domestic priority.14 Government enforcement efforts, many of which were led by Mexican
8

See: CRS Report R42917, Mexico’s New Administration: Priorities and Key Issues in U.S.-Mexican Relations, by
(name redacted).
9
For more information, see CRS Report R41576, Mexico’s Drug Trafficking Organizations: Source and Scope of the
Rising Violence, by (name redacted).
10
U.S. Department of State, International Narcotics Control Strategy Report (INCSR), March 2012,
http://www.state.gov/j/inl/rls/nrcrpt/2012/vol1/184100.htm#Mexico. Hereinafter INCSR, March 2012.
11
According to data from Mexico’s National Survey of Addictions, the prevalence of illicit drug use in Mexico
increased from 0.8% of the population in 2002 to 1.4% in 2008, but remained relatively stable at 1.5% in 2011. Ruth
Rodríguez, “Alcohol, Principal Adicción en el País,” El Universal, October 30, 2012.
12
U.S. Department of Justice, National Drug Intelligence Center, National Drug Threat Assessment: 2011, August
2011, http://www.justice.gov/ndic/pubs44/44849/44849p.pdf.
13
From 2007-2011, the homicide rate per 100,000 people in Mexico increased by an annual average of 15.4% During
that same period, kidnappings increased at an average annual rate of 23.5% and armed vehicular robberies by 19.7%.
Mexico Evalúa, Indicadores de Víctimas Visibles y Invisiblesde Homicidio, Mexico, D.F., November 2012, available
at: http://mexicoevalua.org/descargables/413537_IVVI-H.pdf.
14
The Calderón Administration’s security strategy focused on: (1) carrying out joint police-military operations to
(continued...)

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military forces, took down leaders from all of the major DTOs, either through arrests or deaths
during operations to detain them. The pace of those takedowns accelerated beginning in late
2009, partly due to increased intelligence-sharing between the U.S. and Mexican governments. In
2009, the Mexican government identified the country’s 37 most wanted criminals, and by October
2012, at least 25 of those alleged criminals had been captured or killed, including the head of the
Gulf DTO and of Los Zetas. The Calderón government extradited record numbers of criminals to
the United States, including 93 in 2011; however no top DTO leaders captured were tried and
convicted in Mexican courts.15 The government’s focus on dismantling the leadership of the
major criminal organizations contributed to brutal succession struggles, shifting alliances among
the DTOs, and the replacement of existing groups with ones that were even more violent. 16
Analysts estimate that drug trafficking-related violence in Mexico may have resulted in some
60,000 deaths over the course of the last six years; another 25,000 individuals reportedly went
missing over that period.17 Several sources have reported that violence peaked in 2011, before
falling in 2012, perhaps by as much as 20%.18 Although the violence has primarily taken place in
contested drug production and transit zones, the regions of the country most affected by the
violence have shifted over time, to include large cities (such as Monterrey, Nuevo León) and
tourist zones (Acapulco, Guerrero). Still, there have been incidents of violence across the country,
with the security situation in particular areas sometimes changing rapidly. A State Department
Travel Warning cited security concerns in parts of 19 of Mexico’s 32 states and urged U.S.
citizens to “defer non-essential travel” to Chihuahua, Coahuila, Durango, and Tamaulipas.19
On December 17, 2012, President Peña Nieto outlined a strategy that aims to achieve a “Mexico
in Peace” where human rights are respected and protected by implementing a “state” security
policy that involves binding commitments from all levels of government and civic participation.
The six pillars of the strategy include: 1) planning; 2) prevention; 3) protection and respect of
human rights; 4) coordination; 5) institutional transformation; and 6) monitoring and evaluation.
Although President Peña Nieto has told U.S. media outlets that his government will not abandon
the fight against organized crime, the primary goal of his security strategy is to improve security
conditions inside Mexico. Its success will be measured in reductions in homicides and other
crimes, rather than in drugs seized or kingpins arrested.20

(...continued)
support local authorities and citizens; (2) increasing the operational and technological capacities of the state (such as
the Federal Police); (3) initiating legal and institutional reforms; (4) strengthening crime prevention and social
programs; and (5) strengthening international cooperation (such as the Mérida Initiative). Government of Mexico,
Mexico’s Fight for Security: Strategy and Main Achievements, June 2011.
15
William Booth, “Mexico’s Crime Wave has Left About 25,000 Missing, Government Documents Show,”
Washington Post, November 29, 2012.
16
Patrick Corcoran, “What to Keep, What to Throw Away from Calderon Presidency,” Insight Crime Organized Crime
in the Americas, November 30, 2012.
17
Email from Eduardo Guerrero of Lantoria Consultores, November 30, 2012. Booth op. cit.
18
TBI, Justice in Mexico Project, News Monitor: December 2012.
19
U.S. Department of State, Bureau of Consular Affairs, Travel Warning: Mexico, November 20, 2012, available at:
http://travel.state.gov/travel/cis_pa_tw/tw/tw_5815.html.
20
See: CRS Report R41349, U.S.-Mexican Security Cooperation: The Mérida Initiative and Beyond

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Economic Conditions21
In the late 1980s, Mexico began to restructure its economy through a series of measures that
included liberalizing its highly protective trade regime. The transformation to an open market
economy accelerated after Mexico entered into the North American Free Trade Agreement
(NAFTA) with the United States and Canada in 1994. Through NAFTA, the United States,
Mexico, and Canada form the world’s largest free trade area, with about one-third of the world’s
total Gross Domestic Product (GDP). Since NAFTA, the Mexican economy has increasingly
become a manufacturing-for-export nation, with exports representing 32% of Mexico’s GDP, up
from 10% twenty years ago. Mexico remains a major U.S. crude oil supplier, but its top exports to
the United States have diversified to include automobiles and auto parts, television receivers, and
other manufacturing goods. Overall, Mexico has entered into 12 free trade agreements (FTAs)
involving 44 countries.22
Despite attempts to diversify its economic ties and build its domestic economy, Mexico continues
to remain heavily dependent on the United States as an export market (79% of Mexico’s exports
in 2011 were U.S.-bound), and as a source of tourism revenues, remittances, and investment.
Economic conditions in Mexico tend to follow economic patterns in the United States. When the
U.S. economy is expanding, the Mexican economy tends to grow as well. However, when the
U.S. economy stagnates or is in decline, the Mexican economy tends to decline as well, often by a
higher degree. In 2009, for example, GDP growth in the United States fell by 2.5% and Mexico’s
GDP declined by 6.5%, the worst decline in decades.
The Calderón government has been praised for maintaining macroeconomic stability in the face
of the global economic crisis and U.S. recession, a 2009 H1N1 swine flu epidemic that damaged
the tourism industry, and declining oil production.23 The government used billions in its
international reserves to shore up the peso, and the Mexican central bank established a temporary
reciprocal currency sway line with the U.S. Federal Reserve. The government also hedged its oil
exports in an effort to protect the economy from a decline in oil prices. The central government
increased liquidity in the banking system. It also increased its credit lines with the World Bank,
International Monetary Fund (IMF), and Inter-American Development Bank. In 2009, Mexico’s
fiscal stimulus amounted to 2.5% of GDP and included infrastructure spending and subsidies for
key household budget items. Government programs to support small and medium-sized
businesses, worker training, job creation, and social safety nets were maintained and, in some
cases, expanded.24
Since late 2009, the Mexican economy has rebounded, partially as a result of a resumption in U.S.
demand for Mexican manufacturing exports. Mexico’s GDP grew by 5.5% in 2010 and 3.9% in
2011. As the economy has recovered, the Mexican government has gradually rolled backed
stimulus measures and increased taxes, but has also extended its credit line with the IMF and
21
This section draws from: CRS Report RL32934, U.S.-Mexico Economic Relations: Trends, Issues, and Implications,
by (name redacted).
22
CRS Report R40784, Mexico’s Free Trade Agreements, by (name redacted).
23
Duncan Wood, “Mexico’s Elections and the Economy—Voters Face a Tough Decision,” Center for Strategic &
International Studies, May 2012. Hereinafter Wood, May 2012.
24
This section is drawn from: U.N. Economic Commission for Latin America and the Caribbean (ECLAC), The
Reactions of the Governments of the Americas to the International Crisis: An Overview of Policy Measures up to 31
March 2009, April 2009.

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continued to hedge its oil exports. The Calderón government took steps to try to boost consumer
spending and housing construction so that, in the event that the U.S. and/or global economies
contract, Mexico’s domestic economy would remain as strong as possible.25 The Mexican
economy grew by a healthy 4% in 2012.26
While encouraged by Mexico’s rapid recovery, analysts have identified some challenges that
could constrain the country’s long-term growth potential. Economists have warned that continued
sluggish growth in the U.S. economy could be a “material drag”27 on economic growth in
Mexico. And, although the government can point to positive overall investment trends as
evidence to the contrary, some studies maintain that organized crime-related violence has hurt
Mexico’s competitiveness by raising the costs of doing business in the country.28 Still others have
identified Mexico’s low tax base and over-reliance on declining oil revenues, rigid labor market,
weak education system, and lack of competition in some sectors as obstacles to more robust
economic growth.29 Recently enacted labor and education reforms could help address two of
those obstacles.

Social Conditions
Over the 12 years of PAN rule, Mexico experienced macroeconomic stability and low inflation
and unemployment, but continued to post relatively high rates of poverty and inequality.30 As
elsewhere in Latin America, the 2009 economic downturn in Mexico had a negative impact on the
country’s recent progress in reducing poverty. With a population of 114.7 million (July 2012),
Mexico is classified by the World Bank as an upper-middle-income developing country, with a
per capita income level of $10,064 (2012). According to the U.N. Economic Commission for
Latin America and the Caribbean, the percentage of Mexicans living in poverty fell between 2000
and 2006, but rose again between 2006 and 2008 to include almost 45% of the population. The
percentage of Mexicans living in poverty increased again between 2008 and 2010 to include
46.2% of the population, or roughly 52 million people, according to Mexican government data.
This increase in poverty occurred despite successful government efforts to expand access to
health care, social security, and housing.31
Rural poverty may have further worsened since 2010 as subsistence farmers have been hit hard
by the effects of a drought that began in May 2011 and has affected more than half of the country.
The Mexican government set aside at least $2.5 billion for drought relief, including support for

25

Economist Intelligence Unit (EIU), Country Report: Mexico, January 2012.
EIU, Country Report: Mexico, January 2013.
27
International Monetary Fund (IMF), Mexico: Staff Report for the 2011 Article IV Consultation, IMF Country Report
No. 11/250, July 11, 2011, http://www.imf.org/external/pubs/ft/scr/2011/cr11250.pdf.
28
Although Mexico improved its overall ranking in the World Economic Forum’s 2012-2013 Global Competitiveness
report (to 53rd from 58th out of 144 countries ranked), it ranked 137th out of 144 with respect to the security costs
associated with doing business in the country. Klaus Schwab, ed., Global Competitiveness Report 2012-2013, World
Economic Forum, 2012, http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2012-13.pdf.
29
Francisco Gonzalez, “Drug Violence Isn’t Mexico’s Only Problem,” Current History, February 2011; Organization
for Economic Cooperation and Development (OECD), OECD Economic Surveys: Mexico, May 2011.
30
Wood, May 2012.
31
That is the most recent poverty estimate available. Consejo Nacional de Evaluación de la Política de Desarrollo
Social, Medición de Pobreza 2010, July 29, 2011, http://www.coneval.gob.mx/.
26

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infrastructure to provide drinking water and emergency food aid to affected communities.32 As
Mexico’s crop yields shrunk, the government purchased massive amounts of U.S. corn in an
effort to stave off further price increases for a key food staple.33 Mexican officials have predicted
that it may take years for the country’s cattle industry to recover from the drought.34
Mexico’s main poverty reduction program is Oportunidades (Opportunities). The program,
formerly known as Progresa (Progress), began under President Ernesto Zedillo (1994-2000) and
has since expanded to benefit 5.8 million Mexican families (34 million individuals) mostly in
rural areas. Oportunidades seeks not only to alleviate the immediate effects of poverty through
cash and in-kind transfers, but to break the cycle of poverty by improving nutrition, health
standards, and educational attainment. It provides cash transfers to families in poverty who
demonstrate that they regularly attend medical appointments and can certify that their children are
attending school. While some have praised Oportunidades for its positive effects on educational
and nutritional outcomes, others have criticized it for creating dependency on government
handouts.35 In 2010, the Calderón government established a new program within Oportunidades
for families in urban areas such as Ciudad Juárez and began providing grants to secondary school
students in some rural areas. After two years, high school enrollment had increased by 85% in
rural areas where teenagers had been participating in the program.36
Another key aspect of Mexico’s recent social policy efforts has been to expand access to health
insurance for people who are not covered by the country’s social security system under a program
known as Seguro Popular (Popular Health Insurance). In 2003, the Mexican Congress passed a
law establishing a system by which public funding for health care would be gradually increased
over seven years to achieve universal health insurance. By 2012, more than 52 million previously
uninsured people received full or supplementary insurance through Seguro Popular.37 While
many experts have praised Seguro Popular for expanding low-income Mexicans’ access to
medication and health care, some have criticized it for being inefficient and for not reaching the
poorest communities.38

32

“Government Steps up Support,” Latin American Mexico & NAFTA Report, February 2012.
"Mexico Makes Biggest U.S. Corn Buy in Decades as Crop Shrinks," Reuters News, August 2, 2012.
34
Benjamin Carlson, Patrick Winn, and Jason Overdorf, et al., "The Ripple Effect of Drought," The Toronto Star,
August 4, 2012.
35
Santiago Levy, Good Intentions, Bad Outcomes—Social Policy, Informality and Economic Growth in Mexico.
Washington D.C.: Brookings Institution, April 2008.
36
Government of Mexico, Social Development Secretariat, Oportunidades Program, “Fact Sheet: External Evaluation
Results,” http://www.oportunidades.gob.mx/Portal/wb/Web/external_evaluation_results, accessed September 4, 2012.
37
Government of Mexico, Ministry of Health, Seguro Popular Program, http://www.seguropopular.gob.mx/index.php?option=com_content&view=article&id=272&Itemid=287, accessed September 11, 2012.
38
Felicia Marie Knaul et. al. “The quest for universal health coverage: achieving social protection for all in Mexico,
The Lancet, August 16, 2012; Jason M. Lakin, “The End of Insurance? Mexico’s Seguro Popular: 2001-2007,” Journal
of Health, Politics, and Law, Vol. 35, No. 3, June 2010; Elisabeth Malkin, “Mexico’s Universal Health Care is a Work
in Progress,” New York Times, January 29, 2011.
33

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Foreign Policy
While the bilateral relationship with the United States has continued to dominate Mexican foreign
policy, President Calderón, like his predecessor Vicente Fox, sought to strengthen Mexico’s ties
with Latin America. Calderón regularly met with former Colombian President Álvaro Uribe and
with the government of Juan Manuel Santos, with whom he signed a series of agreements,
including an extradition treaty. In June 2012, Mexico signed an agreement with Colombia, Peru,
and Chile formally establishing an economic block known as the Pacific Alliance to promote
regional integration and trade with Asia. Calderón supported the Central American Security
Strategy39 adopted in June 2011, signed a free trade agreement (FTA) with Central America
(excluding Panama), and offered $160 million to set up an infrastructure fund for the subregion.40 The Calderón government also explored the possibility of forming a Brazil-Mexico
FTA, as well as developing greater energy cooperation between PEMEX and Petrobras, Brazil’s
state oil company. President Calderón also tried to mend relations with Cuba and Venezuela,
which had become tense during the Fox Administration.
Mexico also took an active role with respect to global issues. Calderón played a lead role in
global climate change negotiations, with Mexico hosting the U.N. Climate Change Conference in
Cancún in late 2010. At the Asia-Pacific Economic Cooperation (APEC) Forum in November
2011, the Mexican government announced that it would seek consultations with partner countries
about joining the negotiations for a Trans-Pacific Partnership (TPP) Agreement.41 On June 18,
2012, President Obama announced that the nine countries involved in the TPP negotiations had
extended an invitation to Mexico.42 As rotating head of the G20 nations, Mexico hosted the G20
Summit in June 2012. Although euro-zone debt problems dominated the discussions, Mexican
officials also reportedly sought to focus attention on food security issues. This umbrella topic
included concerns regarding sustainability, supporting small-scale farmers, and diversifying biofuels production to minimize its impact on global food supplies.43

Mexican-U.S. Relations: Issues for Congress
Until the early 1980s, Mexico had a closed and statist economy and its independent foreign policy
was often at odds with the United States. Those policies began to shift, however, under President
Miguel de la Madrid (1982-1988), and changed even more dramatically under President Carlos
Salinas de Gortari (1988-1994) and President Ernesto Zedillo (1994-2000). President Salinas
opened Mexico’s economy to trade and investment, while President Zedillo adopted electoral
reforms that leveled the playing field for opposition parties and increased cooperation with the
United States on drug control and border issues.

39

Mexico is a member of the “Group of Friends of Central America,” a donor group consisting of country and
multilateral organizations, which has pledged to support the Central American Security Strategy (CASS) adopted at a
summit in Guatemala in June 2011.
40
“Central America and Mexico Shore up Ties,” Latin News Daily Briefing, December 6, 2011.
41
For background on the TPP trade agreement negotiations, see: CRS Report R42694, The Trans-Pacific Partnership
Negotiations and Issues for Congress, coordinated by (name redacted).
42
An invitation for Canada to join the TPP negotiations followed on June 19, 2012.
43
Jean Guerrero, "Mexico to Keep Food Security on Global Radar With New Focus," Dow Jones International News,
June 20, 2012.

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President Fox (2000-2006) encouraged strong relations with the United States, and called for
greater cooperation under NAFTA and for a bilateral migration agreement that would regularize
the status of undocumented Mexicans in the United States. In the aftermath of the September
2001 terrorist attacks in the United States, the focus of relations shifted to border security issues
as the United States became increasingly concerned about homeland security. Relations became
strained during the debate on immigration reform in the United States. After then-President
George W. Bush approved the Secure Fence Act of 2006, Mexico, with the support of 27 other
nations, denounced the proposed border fence at the Organization of American States.
Under the Calderón government, security cooperation, rather than immigration or trade,
dominated the U.S.-Mexican relationship. During then-President Bush’s March 2007 visit to
Mexico, President Calderón called for U.S. assistance in combating drug and weapons trafficking.
Calderón’s willingness to increase narcotics cooperation with the United States led to the
development of the Mérida Initiative, a multi-year U.S. assistance effort announced in October
2007 to help Mexico and Central America combat drug trafficking and crime. The Mérida
Initiative signaled a major diplomatic step forward for bilateral counterdrug cooperation as the
Mexican government put sovereignty concerns aside to allow extensive U.S. involvement in its
domestic security policies.
U.S.-Mexican relations continued to be close under the first Obama Administration, with security
cooperation intensifying under a new Mérida Initiative strategy that encompassed institutionbuilding, border issues, and development in Mexico. In January 2009, President Calderón visited
then President-elect Obama in Washington, DC. That pre-inaugural meeting, which has become
somewhat of a tradition for recent U.S. Presidents, demonstrated the importance of strong
relations with Mexico. President Obama met frequently with President Calderón throughout his
first term, both on a bilateral basis and at trilateral North American Leaders’ Summits convened
with Canadian Prime Minister Stephen Harper. Although security issues frequently dominated
these discussions, enhancing North American competitiveness and energy cooperation also
figured prominently.
U.S.-Mexican presidential summits were reinforced by frequent cabinet-level meetings between
the two governments, as well as the creation of bilateral working groups formed to address
specific topics. On September 18, 2012, U.S. and Mexican cabinet-level officials met for the
fourth time to review the results of five years of Mérida cooperation, reaffirm their commitment
to its strategic framework, and pledge to deepen the cooperation the Mérida Initiative has
established. U.S.-Mexican security cooperation continued even as tension emerged in bilateral
relations, including after the resignation of the U.S. Ambassador to Mexico in March 2011 and
two incidents in which U.S. agents were shot while working in Mexico.
As Mexico is experiencing a domestic shift in power from PAN to PRI rule, U.S.-Mexican
relations could also be in for some changes. 2013 marks the first time in 12 years that U.S. and
Mexican presidential terms are beginning at roughly the same time. While President Obama and
President Peña Nieto both face a full slate of domestic challenges, analysts have urged both
leaders to work together on issues that are of critical importance to both countries, particularly
those aimed at boosting trade and job creation. At a pre-inaugural meeting in late November
2012, President Obama embraced Peña Nieto’s desire to bolster economic ties and to focus on a
broad array of bilateral issues rather than focusing predominantly on security issues.44
44
The White House, Office of the Press Secretary, “Remarks of President Obama and President-Elect Peña Nieto of
(continued...)

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U.S. Assistance to Mexico
Merida Initiative45
In recent years, Congress has played an increasingly active role in shaping U.S.-Mexican
relations through funding and overseeing the Mérida Initiative, an anticrime and counterdrug
assistance package that began in FY2008. Prior to that time, Mexico, a middle income country,
had not been a major recipient of U.S. foreign assistance. As a result of the Mérida Initiative, U.S.
assistance to Mexico rose from $65 million in FY2007 to $406 million in FY2008. Table 1 below
provides an overview of U.S. assistance to Mexico funded through the State Department.
From FY2008-FY2012, Congress appropriated $1.9 billion in Mérida assistance for Mexico (see
Table 2 below), roughly $1.1 billion of which had been delivered as of November 2012. Mérida
Initiative assistance has flowed through the International Narcotics Control and Law Enforcement
(INCLE), Economic Support Fund (ESF), and, until recently, Foreign Military Financing (FMF)
accounts. Whereas Mérida assistance initially focused on training and equipping Mexican
counterdrug forces, it now aims to address the weak institutions and underlying societal
problems—including corruption and impunity—that have allowed the drug trade to flourish in
Mexico. The updated Mérida strategy, announced in March 2010, focuses on four pillars: (1)
disrupting organized criminal groups, (2) institutionalizing the rule of law, (3) building a 21st
century border, and (4) building strong and resilient communities. The bulk of U.S. assistance
under Mérida is supporting training and technical assistance programs for Mexico’s justice sector
under pillar two of the Mérida strategy. U.S. assistance has shifted from only supporting the
Mexican federal government to assisting certain key states with police and judicial reform efforts,
as well as community-based crime prevention programs.
Table 1. U.S. Assistance to Mexico by Account, FY2007-FY2013
(U.S. $ millions)
FY2007

FY2008a

FY2009b

FY2010

FY2011

FY2012
(est.)

FY2013
(req.)

INCLE

36.7

242.1

454.0c

365.0d

117.0

248.5

199.0

ESF

11.4

34.7

15.0

15.0

18.0

33.3

35.0

5.3

8.0

7.0

7.0

Account

FMF

0.0

116.5

299.0e

IMET

0.1

0.4

0.8

1.0

1.0

1.6

1.5

NADR

1.3

1.4

3.9

3.9

5.7

5.4

4.0

GHCSf

3.7

2.7

2.9

3.5

3.5

1.0

0.0

DA

12.3

8.2

11.2

10.0

25.0

33.4

23.0

TOTAL

65.4

405.9

786.8

403.7

178.2

330.2

269.5

Sources: U.S. Department of State, Congressional Budget Justification for Foreign Operations FY2008-FY2012, and
FY2013 Executive Budget Summary: Function 150 & Other International Programs.
(...continued)
Mexico Before Bilateral Meeting,” Press Release, November 27, 2012.
45
For more information, see: CRS Report R41349, U.S.-Mexican Security Cooperation: The Mérida Initiative and
Beyond, by (name redacted) and Kristin M. Finklea.

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Notes: GHCS=Global Health and Child Survival; DA=Development Assistance; ESF=Economic Support Fund;
FMF=Foreign Military Financing; IMET=International Military Education and Training; INCLE=International
Narcotics Control and Law Enforcement; NADR=Non-proliferation, Anti-terrorism and Related Programs.
Funds are accounted for in the fiscal year for which they were appropriated as noted below:
a.

FY2008 assistance includes funding from the Supplemental Appropriations Act, 2008 (P.L. 110-252).

b.

FY2009 assistance includes FY2009 bridge funding from the Supplemental Appropriations Act, 2008 (P.L.
110-252) and funding from the Supplemental Appropriations Act, 2009 (P.L. 111-32).

c.

$94 million provided under P.L. 111-32 and counted here as part of FY2009 funding was considered by
appropriators “forward funding” intended to address in advance a portion of the FY2010 request.

d.

$175 million provided in the FY2010 supplemental (P.L. 111-212) and counted here as FY2010 funding was
considered by appropriators as “forward funding” intended to address in advance a portion of the FY2011
request.

e.

$260 million provided under a FY2009 supplemental (P.L. 111-32) and counted here as FY2009 funding was
considered by appropriators “forward funding” intended to address in advance a portion of the FY2010
request.

f.

Prior to FY2008, the Global Health and Child Survival account was known as Child Survival and Health.

Congress has played a major role in determining the level and composition of Mérida funding for
Mexico. In the beginning, Congress included funding for Mexico in supplemental appropriations
measures in an attempt to hasten the delivery of certain equipment. Congress has also earmarked
funds for specific purposes in order to ensure that certain programs are prioritized, such as efforts
to support institutional reform in Mexico. Finally, Congress has sought to influence human rights
conditions and encourage efforts to combat abuses and impunity in Mexico by placing conditions
on Mérida-related assistance (see “Human Rights” below).
Table 2. FY2008-FY2013 Mérida Funding for Mexico by Aid Account and
Appropriations Measure
($ in millions)
FY2008
Supp.
(P.L. 110252)

FY2009
(P.L. 1118)

FY2009
Supp.
(P.L. 11132)

FY2010
(P.L. 111117)

FY2010
Supp.
(P.L. 111212)

FY2011
(P.L. 11210)

FY2012
Estimate
(P.L. 11274)

Account
Totals

FY2013
Request

ESF

20.0

15.0

0.0

15.0a

0.0

18.0

33.3

101.3

35.0

INCLE

263.5

246.0

160.0

190.0

175.0

117.0

248.5

1,400.0

199.0

FMF

116.5

39.0

260.0

5.3

0.0

8.0

Not
applicableb

428.8

Total

400.0

300.0

420.0

210.3

175.0

143.0

281.8

1,930.1

Account

Sources: U.S. Department of State, Congressional Budget Justification for Foreign Operations FY2008-FY2012,
FY2013 Executive Budget Summary: Function 150 & Other International Programs.
Notes: ESF=Economic Support Fund; FMF=Foreign Military Financing; INCLE=International Narcotics Control
and Law Enforcement.
a.

$6 million was later reprogrammed for global climate change efforts by the State Department.

b.

Beginning in FY2012, FMF is not considered as part of Mérida Initiative funding.

There appears to be strong support in both the Senate and House for maintaining U.S. support to
Mexico provided through Mérida Initiative accounts. The Administration’s FY2013 budget
request asked for $234 million in Mérida assistance for Mexico: $199 million in the International
Narcotics and Law Enforcement (INCLE) account and $35 million in the Economic Support

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Mexico and the 112th Congress

Fund (ESF) account. The Senate Appropriations Committee’s version of the FY2013 foreign
operations appropriations measure, S. 3241 (S.Rept. 112-172), would have met the request for
INCLE and provided $10 million in additional ESF for economic development projects in the
border region. S. 3241 included restrictions on aid to the Mexican military and police. The House
Appropriations Committee’s version of the bill, H.R. 5857 (H.Rept. 112-494), would have
increased INCLE funding by $49 million to match the FY2012 enacted level for that account and
met the request for ESF.
In the absence of a final FY2013 foreign appropriations measure, Congress passed a continuing
resolution, H.J.Res. 117, to fund most foreign aid programs—including assistance to Mexico—at
FY2012 levels plus 0.6% through March 27, 2013.

Non-Merida Assistance Programs
Apart from Mérida-related funding, Congress doubled development assistance (DA) to Mexico
from FY2010 to FY2011, and increased it again to $33 million in FY2012. The U.S. Agency for
International Development (USAID) uses DA to support programs aimed at boosting private
sector competitiveness, promoting sustainable energy development, and forming partnerships
with faculty and students from Mexican universities to address climate change and rule of law
issues. Assistance provided through the Global Health and Child Survival (GHCS) that has helped
the Mexican government both prevent and treat HIV/AIDS and other infectious diseases ended in
FY2012. Mexico also benefits from military training programs funded through the State
Department’s International Military Education and Training Account (IMET), as well as
counterterrorism assistance provided through the Non-proliferation, Anti-terrorism and Related
Programs (NADR) account.

Department of Defense Support to Mexico
Apart from the Mérida Initiative, DOD has its own legislative authorities to provide certain
counterdrug assistance. DOD programs in Mexico are overseen by the U.S. Northern Command
(NORTHCOM), which is located at Peterson Air Force Base in Colorado. DOD can provide
counterdrug assistance under guidelines outlined in Section 1004 of P.L. 101-510, as amended
through FY2014, and can provide additional assistance to certain countries as provided for in
Section 1033 of P.L. 105-85, as amended through FY2013. DOD counternarcotics support to
Mexico totaled roughly $34.2 million in FY2009, $89.7 million in FY2010, and $84.7 million in
FY2011. DOD is using some $50 million in FY2011 per Section1033 of P.L. 105-85 funds to
improve security along the Mexico-Guatemala-Belize border. Total DOD support to Mexico in
stood at $100.4 million in FY2012 and may exceed $75.3 million in FY2013.46

46
FY2009-FY2010 figures are from a DOD response to CRS request, March 21, 2011. FY2011-FY2013 figures are
from a DOD response to CRS request, February 17, 2012. These data reflect non-budget quality estimates of DOD
counternarcotics support provided or efforts in these nations/regions; DOD does not budget counternarcotics programs
by regions/countries, but by program. These figures reflect both “direct” support to those countries (e.g., training,
equipment, information sharing, infrastructure and other categories) and “indirect” support via DOD and other U.S.
Government counterdrug operations with regard to those countries (e.g., transportation, communications, intelligence
analysis, radar, air and maritime patrol, liaison personnel, and other categories) as well as operation of Cooperative
Security Locations.

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Bilateral Cooperation on Counternarcotics and Security Efforts
In the 1980s and 1990s, U.S.-Mexican counternarcotics efforts were often marked by mistrust,
especially following the 1985 killing of DEA Special Agent Enrique Camarena in Mexico.
Beginning in 1986, when the U.S. President was required to certify whether drug-producing
countries and drug-transit countries were cooperating fully with the United States, Mexico often
was criticized for its lack of effort, which in turn led to Mexican government criticism of the U.S.
assessment. Reforms to the U.S. drug certification process enacted in September 2002 (P.L. 107228) essentially eliminated the annual drug certification requirement, and instead required the
President to designate and withhold assistance from countries that had “failed demonstrably” to
make substantial counternarcotics efforts. In the aftermath of this legislative change, antidrug
cooperation with Mexico improved considerably during the Fox administration (2000-2006).
Over the last five years, U.S.-Mexican security cooperation has intensified significantly as a
result of the Mérida Initiative. U.S.-Mexican cooperation has evolved to the point where it is able
to continue even amidst serious strain caused by sometimes unforeseen events. For example,
bilateral efforts against weapons trafficking continued even after the failed Bureau of Alcohol,
Tobacco, Firearms, and Explosives (ATF) operation dubbed “Fast and Furious” resulted in
firearms being trafficked into Mexico.47 U.S. training and law enforcement support efforts have
advanced even as U.S. personnel have been injured and even killed while working in Mexico.
The U.S. government has helped Mexican government investigate the circumstances under which
two U.S. Central Intelligence Agency (CIA) employees were wounded on August 24, 2012, as
their vehicle came under heavy fire from Mexican Federal Police.
In the 2007 U.S.-Mexico joint statement announcing the Mérida Initiative, the U.S. government
pledged to “intensify its efforts to address all aspects of drug trafficking (including demandrelated portions) and continue to combat trafficking of weapons and bulk currency to Mexico.”48
Although not funded through the Mérida Initiative, the U.S. government has made efforts to
address each of these issues, with efforts to combat weapons trafficking and, to a lesser extent,
money laundering having received congressional scrutiny.

Overview of Related Southwest Border Initiatives49
The increase in drug trafficking-related violence between and among DTOs in Mexico has
generated concern among U.S. policy makers that the violence in Mexico might spill over into the
United States.50 U.S. federal officials have denied that the recent increase in violence in Mexico
has resulted in a spillover into the United States, but acknowledged that the prospect is a serious
concern.51 In March 2009, Secretary of Homeland Security Janet Napolitano announced a set of
47

For background, see: CRS Report RL32842, Gun Control Legislation, by (name redacted).
U.S. Department of State and Government of Mexico, "Joint Statement on the Mérida Initiative: A New Paradigm
for Security Cooperation," October 22, 2007.
49
See the Appendix of CRS Report R41075, Southwest Border Violence: Issues in Identifying and Measuring Spillover
Violence, coordinated by Kristin M. Finklea; and CRS Report R42138, Border Security: Immigration Enforcement
Between Ports of Entry, by (name redacted).
50
CRS Report R41075, Southwest Border Violence: Issues in Identifying and Measuring Spillover Violence,
coordinated by Kristin M. Finklea.
51
See for example, Department of Homeland Security (DHS), “Remarks by Secretary Napolitano on Border Security at
the University of Texas at El Paso,” press release, January 31, 2011.
48

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Southwest border initiatives aimed at (1) guarding against violent crime spillover into the United
States; (2) supporting Mexico’s crackdown campaign against drug cartels in Mexico; and (3)
reducing the movement of contraband in both directions across the border. The Obama
Administration authorized the deployment of 1,200 National Guard troops to the U.S.-Mexico
border in July 2010 to support counternarcotics enforcement efforts. In December 2011, DOD
and the Department of Homeland Security (DHS) announced that the National Guard would shift
from the use of ground troops in law enforcement support roles to an emphasis on providing
aerial surveillance support for the Border Patrol.52 That mission is continuing in 2013.
Escalating violence in Mexico has focused congressional concern on the efficacy of these efforts
to secure the Southwest border. The 112th Congress held hearings on the adequacy of DHS and
other federal agencies’ efforts to secure the border and enacted legislation to further bolster those
efforts.53 P.L. 112-93 increases penalties for aviation smuggling and P.L. 112-127 tightens
sentencing guidelines for building border tunnels.
Components of DHS are providing significant assistance to secure the Southwest border.
Immigration and Customs Enforcement (ICE) has created 21 Border Enforcement Security Task
Forces (BESTs) since 2006, including 12 on the Southwest border and 1 in Mexico City. The task
forces serve as platforms for cooperation among local, state, and federal agencies as well as a
point of cooperation with Mexico’s Secretary of Public Security (SSP). The 112th Congress
enacted P.L. 112-205, which provides statutory authority for the BEST program. ICE has also set
up a Transnational Criminal Investigative Unit (TCIU) in Mexico that works with ICE special
agents on criminal investigations and prosecutions. ICE, Customs and Border Protection (CBP),
and the U.S. Coast Guard have long-standing relationships with their Mexican counterparts to
jointly disrupt the activities of DTOS. CBP and Mexican Customs now coordinate southbound
inspections in search of bulk cash and weapons. DHS has also provided funds to reimburse
Southwest border states for border-security related expenses through Operation Stonegarden.
In March 2009, the Department of Justice (DOJ) announced increased efforts to combat Mexican
drug cartels in the United States and to help Mexican law enforcement battle the cartels in their
own country. DOJ components involved in the increased efforts include the FBI; Drug
Enforcement Administration (DEA); ATF; U.S. Marshals Service (USM); the department’s
Criminal Division; and the Office of Justice Programs. By mid-2011, large-scale investigative
operations against Mexican DTOs and their affiliates in the United States had led to the arrest of
more than 5,500 suspects and the seizure of more than $300 million in illicit funds.54 DOJ’s
Criminal Division has created a team focused on investigating and prosecuting cases against
Mexican DTOs within its Asset Forfeiture and Money Laundering Section. DOJ is also pursuing
increased extraditions from Mexico.

52

DHS, “DHS and DOD Announce Continued Partnership in Strengthening Southwest Border Security,” press release,
December 20, 2011.
53
See, for example: U.S. Congress, House Committee on Homeland Security, Subcommittee on Oversight,
Investigations, and Management, The US Homeland Security Role in the Mexican War Against Drug Cartels, 112th
Cong., 1st sess., March 31, 2011.
54
Ibid.

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Money Laundering and Bulk Cash Smuggling
It is estimated that between $19 billion and $29 billion in illicit proceeds flow from the United
States to drug trafficking organizations and other organized criminal groups in Mexico each
year.55 Much of the money is generated from the illegal sale of drugs in the United States and is
laundered to Mexico through mechanisms such as bulk cash smuggling. While bulk cash
smuggling has been a prominent means by which criminals move illegal profits from the United
States into Mexico, they have increasingly turned to stored value cards to move money. With
these cards, criminals are able to avoid the reporting requirement under which they would have to
declare any amount over $10,000 in cash moving across the border. Current federal regulations
regarding international transportation only apply to monetary instruments as defined under the
Bank Secrecy Act.56 Of note, stored value cards are not considered monetary instruments under
current law.
The Financial Crimes Enforcement Network (FinCEN)57 has issued a final rule, defining “stored
value” as “prepaid access” and implementing regulations regarding the recordkeeping and
suspicious activity reporting requirements for prepaid access products and services.58 This rule
does not, however, directly address whether stored value or prepaid access cards would be subject
to current regulations regarding the international transportation of monetary instruments. A
separate proposed rule would amend the definition of “monetary instrument,” for the purposes of
BSA international monetary transport regulations, to include prepaid access devices.59 Even if
FinCEN were to issue a final rule and implement regulations requiring individuals leaving the
United States to declare stored value, the GAO has identified several challenges that would
remain.60 These challenges relate to law enforcement’s ability to detect the actual cards and to
differentiate legitimate from illegitimate stored value on cards; travelers’ abilities to remember
the amount of stored value on any given card; and law enforcement’s ability to determine where
illegitimate stored value is physically held and subsequently freeze and seize the assets.
Aside from bulk cash smuggling and stored-value cards, Mexican traffickers move and launder
money by using digital currency accounts, e-businesses that facilitate money transfers via the
Internet, online role-playing games or virtual worlds that enable the exchange of game-based
currencies for real currency, and mobile banking wherein traffickers have remote access—via cell
phones—to bank and credit card accounts as well as prepaid cards.61 The proceeds may then be
55

DHS, United States-Mexico Bi-National Criminal Proceeds Study, June 2010.
31 U.S.C. §5312 defines a monetary instrument as “(A) United States coins and currency; (B) as the Secretary may
prescribe by regulation, coins and currency of a foreign country, travelers’ checks, bearer negotiable instruments,
bearer investment securities, bearer securities, stock on which title is passed on delivery, and similar material; and
(C) as the Secretary of the Treasury shall provide by regulation for purposes of sections 5316 and 5331, checks, drafts,
notes, money orders, and other similar instruments which are drawn on or by a foreign financial institution and are not
in bearer form.”
57
FinCEN, under the Department of the Treasury, administers the BSA and the nation’s financial intelligence unit.
FinCEN also supports law enforcement, intelligence, and regulatory agencies by analyzing and sharing financial
intelligence information. For more information, see http://www.fincen.gov/about_fincen/wwd/strategic.html.
58
Department of the Treasury, Financial Crimes Enforcement Network, “Bank Secrecy Act Regulations—Definitions
and Other Regulations Relating to Prepaid Access,” 76, No. 146 Federal Register 45403-45420, July 29, 2011.
59
Department of the Treasury, "Bank Secrecy Act Regulations Definition of “Monetary Instrument," 76 Federal
Register 64049, October 17, 2011.
60
GAO, Moving Illegal Proceeds: Challenges Exist in the Federal Government’s Effort to Stem Cross Border
Smuggling, October 2010, pp. 48–49.
61
Douglas Farah, Money Laundering and Bulk Cash Smuggling: Challenges for the Merida Initiative, Woodrow
(continued...)
56

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used by DTOs and other criminal groups to acquire weapons in the United States and to corrupt
law enforcement and other public officials.
Countering financial crimes—including money laundering and bulk cash smuggling—is one
effort outlined by the National Southwest Border Counternarcotics Strategy (SWBCS).62 To curb
the southbound flow of money from the sale of illicit drugs in the United States, the SWBCS
includes several goals: stemming the flow of southbound bulk cash smuggling, prosecuting the
illegal use of MSBs and electronic payment devices, increasing targeted financial sanctions,
enhancing multilateral/bi-national collaboration, and empirically assessing the money laundering
threat.63
In 2005, ICE and CBP launched a program known as “Operation Firewall,” which increased
operations against bulk cash smuggling in the U.S.-Mexico border region. This operation was reinitiated in January 2010, and between January 2010 and April 2011, Operation Firewall resulted
in eight arrests and the seizure of $6 million in U.S. currency.64 U.S. efforts against money
laundering and bulk cash smuggling are increasingly moving beyond the federal level as well, as
experts have recommended.65 In December 2009, for example, ICE opened a bulk cash
smuggling center to assist U.S. federal, state, and local law enforcement agencies track and
disrupt illicit funding flows. Still, the GAO has identified several ways in which CBP outbound
inspections and other U.S. efforts against bulk cash smuggling, particularly those aimed at
combating the use of stored value cards, might be improved.66
The United States and Mexico have created a Bilateral Money Laundering Working Group to
coordinate the investigation and prosecution of money laundering and bulk cash smuggling. A
recent Bi-national Criminal Proceeds Study revealed that some of the major points along the
Southwest border where bulk cash is smuggled include San Ysidro, CA; Nogales, AZ; and
Laredo, McAllen, and Brownsville, TX.67 Information provided from studies such as these may
help inform policy makers and federal law enforcement personnel and assist in their decisions
regarding where to direct future efforts against money laundering.
Despite these efforts, the 112th Congress held hearings, issued reports, and introduced legislation
on how current money laundering efforts could be bolstered.

(...continued)
Wilson Center’s Mexico Institute, Working Paper Series on U.S.-Mexico Security Cooperation, May 2010, p. 161,
available at http://www.wilsoncenter.org/topics/pubs/Farah.pdf.
62
ONDCP, National Southwest Border Counternarcotics Strategy, 2011, available at
http://www.whitehousedrugpolicy.gov/publications/swb_counternarcotics_strategy11/
swb_counternarcotics_strategy11.pdf. Herein after, SWBCS, 2011. The SWBCS is implemented by the Director of
National Drug Control Policy, in conjunction with the DHS Office of Counternarcotics Enforcement as well as the DOJ
Office of the Deputy Attorney General.
63
Ibid., pp. 31-36.
64
U.S. Embassy, “Fact Sheet: Combating Money Laundering,” April 2011.
65
Farah, op. cit.
66
GAO, Moving Illegal Proceeds: Challenges Exist in the Federal Government’s Effort to Stem Cross Border
Smuggling, GAO-11-73, October 2010, available at http://www.gao.gov/products/GAO-11-73.
67
DHS, United States - Mexico Bi-National Criminal Proceeds Study, 2010.

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Firearms Trafficking68
Illegal firearms trafficking from the United States has been cited as a significant factor in the drug
trafficking-related violence in Mexico. To address this issue, the Bureau of Alcohol, Tobacco,
Firearms, and Explosives (ATF) stepped up enforcement of domestic gun control laws in the four
Southwest border states under an agency-wide program known as “Project Gunrunner.” ATF has
also trained Mexican law enforcement officials to use its electronic tracing (eTrace) program,
through which investigators are sometimes able to trace the commercial trail and origin of
recovered firearms. In the past, ATF has periodically released data on firearms traces performed
for Mexican authorities. Although substantive methodological limitations preclude using trace
data as a proxy for the larger population of “crime guns” in Mexico or the United States, trace
data have proven to be a useful indicator of trafficking trends and patterns. In June 2009, GAO
recommended to the Attorney General that he should direct ATF to update regularly its reporting
on aggregate firearms trace data and trends.69 For the last two years, however, ATF has only
released limited and arguably selected amounts of trace data.
In February 2011, ATF came under intense congressional scrutiny for a Phoenix, AZ-based
Project Gunrunner investigation known as Operation Fast and Furious, when ATF whistleblowers
reported that suspected straw purchasers70 had been allowed to acquire relatively large quantities
of firearms as part of long-term gun trafficking investigations.71 Some of these firearms are
alleged to have “walked,” or been trafficked to gunrunners and other criminals, before ATF
moved to arrest the suspects and seize all of their contraband firearms. Two of those firearms
were reportedly found at the scene of a shootout near the U.S.-Mexico border where U.S. Border
Patrol Agent Brian Terry was shot to death.72 Questions have also been raised about whether a
firearm that was reportedly used to murder ICE Special Agent Jamie Zapata and wound Special
Agent Victor Avila in Mexico on February 15, 2011, was initially trafficked by a subject of a
Houston, TX-based Project Gunrunner investigation.73 While it remains an open question whether
ATF or other federal agents were in a position to interdict the firearms used in these deadly
attacks before they were smuggled into Mexico,74 neither DOJ nor ATF informed their Mexican
counterparts about these investigations and the possibility that some of these firearms could be
reaching Mexico.75

68

For more information, see CRS Report R40733, Gun Trafficking and the Southwest Border, by (name redacted) and
(name redacted); CRS Report RL32842, Gun Control Legislation, by (name redacted).
69
GAO, Firearms Trafficking: U.S. Efforts to Combat Arms Trafficking to Mexico Face Planning and Coordination
Challenges, GAO-09-709, June 2009, p. 59.
70
A “straw purchase” occurs when an individual poses as the actual transferee, but he is actually acquiring the firearm
for another person. In effect, he serves as an illegal middleman. Straw purchases can be prosecuted under two
provisions of the Gun Control Act of 1968, as amended (18 U.S.C. 922(a)(6) and 18 U.S.C. §924(a)(1)(A)).
71
James v. Grimaldi and Sari Horwitz, “ATF Probe Strategy Is Questioned,” Washington Post, February 2, 2011.
72
Ibid.
73
Ibid.
74
Operation Fast and Furious was launched in November 2009. It was approved as an Organized Crime and Drug
Enforcement Task Force (OCDETF) investigation in February 2010. As an OCDETF investigation, it was then directed
largely by the U.S. Attorney’s Office in Phoenix. While ICE and Internal Revenue Service (IRS) agents were also part
of this investigation, so far their role in this operation has not generated public or congressional scrutiny.
75
Richard A. Serrano, “U.S. Embassy Kept in Dark as Guns Flooded Mexico,” Salt Lake Tribune, July 25, 2011.

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Legislators in both the United States and Mexico have voiced ongoing concerns about Operation
Fast and Furious.76 Repeated Congressional inquiries prompted U.S. Attorney General Eric
Holder to direct his Inspector General to conduct a third evaluation of Project Gunrunner, which
was delivered to Congress in September 2012.77 In addition, in July 2011, the Office of
Management and Budget (OMB) approved an ATF multiple rifle sales reporting requirement for a
three-year period.78 Under this reporting requirement, federally licensed gun dealers in Southwest
border states are required to report to ATF whenever they make multiple sales or other
dispositions of more than one rifle within five consecutive business days to an unlicensed
person.79

Alien Smuggling and Human Trafficking
As bilateral efforts under the Mérida Initiative and U.S. domestic efforts to combat illicit flows
related to the drug trade have intensified, Mexican DTOs, particularly Los Zetas, have branched
out into other illicit activities, including alien smuggling and human trafficking. Alien smuggling
involves people who pay to be illegally transported from or through Mexico into the United
States. Some of the smugglers who profit from this activity have ties to DTOs and have
kidnapped, extorted, and killed migrants.80 U.S. and Mexican officials share security concerns
about the increasing involvement of organized crime groups in alien smuggling. Human
trafficking refers to cases in which individuals are coerced into sexual exploitation or forced
labor; some migrants who contract with smugglers eventually become victims of human
trafficking. Undocumented migrants, along with women, children, and indigenous persons, have
been identified as groups that are particularly vulnerable to human trafficking in Mexico.
Mexican and U.S. law enforcement agencies collaborate to combat alien smuggling and human
trafficking. For example, through the Operation Against Smuggling Initiative on Safety and
Security (OASISS), Mexican alien smugglers apprehended in the United States can be prosecuted
in Mexico. From the time of its inception in 2005 through the end of FY2011, OASISS referred
2,617 cases to Mexican authorities.81
Mexican and bilateral investigations and prosecutions against human trafficking have intensified
since Mexico reformed its federal criminal procedure code to criminalize trafficking in late 2007.
All of Mexico's states have enacted code reforms that criminalize at least some forms of human
trafficking. Since 2007, the State Department has removed Mexico from its human trafficking
watch list and ranked it as a "Tier 2" country (the second-best out of four categories) in its annual
76

Dennis Wagner, “Gun Shop Told ATF Sting Was Perilous,” Arizona Republic, April 15, 2011, p. A1.
United States Department of Justice, Office of the Inspector General, Statement of Michael E. Horowitz, Inspector
General, U.S. Department of Justice before the House Committee on Oversight and Government Reform Concerning
Report by the Office of the Inspector General on the Review of ATF’s Operation Fast and Furious and Related Matters,
September 20, 2012, http://www.justice.gov/oig/testimony/t1220.pdf.
78
Office of Management and Budget, Office of Information and Regulatory Affairs, Reviews Completed in the Last 30
Days, DOJ-ATF, Report of Multiple Sale or Other Disposition of Certain Semi-Automatic Rifles, OMB Control
Number: 1140-0100.
79
This reporting requirement is limited to firearms that are (1) semiautomatic, (2) chambered for ammunition of greater
than .22 caliber, and (3) capable of accepting a detachable magazine.
80
In late August 2010, 72 Central and South American migrants passing through Mexico were found massacred in
Tamaulipas. According to a survivor, Los Zetas attempted to recruit the migrants to assist in moving drugs and killed
them when they refused.
81
U.S. Border Patrol Office of Legislative Affairs, October 17, 2011.
77

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Trafficking in Persons (TIP) reports, reflecting this progress. According to the State Department’s
TIP report covering 2011, Mexico convicted 14 sex traffickers in 2011, but did not report any
convictions for forced labor. Observers maintain that the number of prosecutions recorded is low
relative to the scale of the human trafficking problem in Mexico. The Mexican Congress recently
approved a new law against trafficking that amends the 2007 federal anti-TIP law and includes
prison sentences of up to 40 years for people convicted of sexual exploitation. Yet the Congress
also cut funding for anti-TIP efforts and for the Attorney General's Office in 2012.
Many Mexican law enforcement activities with respect to combating alien smuggling and human
trafficking receive some degree of U.S. financial support. One way to increase Mexico's role in
migration enforcement may be for Congress to consider additional investments in these programs.
The United States also could include migration control as an explicit priority within other existing
programs, such as the Mérida Initiative. On the other hand, Mexico is already among the largest
recipients of U.S. anti-TIP assistance in the Western Hemisphere, and some Members of Congress
may be reluctant to invest more resources in such programs.

Human Rights
Conditions and Mexican Efforts to Improve
The State Department has long documented concerns about human rights conditions in Mexico.
Mexican and international human rights groups have presented evidence that human rights
conditions in the country have deteriorated as a result of the brutal violence perpetrated by
organized crime groups and the government’s response to that violence.82 Although human rights
issues related to the Mexican government’s struggle against organized crime have received the
most attention in recent years, other societal abuses have continued to be observed. Those include
domestic violence and femicide; trafficking in persons; and abuses against migrants transiting
Mexico, particularly undocumented migrants from Central America.
There have been ongoing concerns about the human rights records of Mexico’s federal, state, and
municipal police. For the past several years, State Department’s human rights reports covering
Mexico have cited credible reports of police involvement in extrajudicial killings, kidnappings for
ransom, and torture.83 While abuses are most common at the municipal and state level, where
corruption and police collaboration with criminal groups often occurs, federal forces—including
the Federal Police—have also committed serious abuses. Individuals are most vulnerable to
police abuses after they have been arbitrarily detained and before they are transferred to the
custody of prosecutors, or while they are being held in preventive detention. Some 43% of
Mexican inmates are reportedly in pre-trial detention.84
The Calderón government sought to combat police corruption and human rights abuses through
increased vetting of federal forces; the creation of a national police registry to prevent corrupt
82

“Crecen 70% Quejas por Derechos Humanos: CNDH,” El Universal, July 26, 2011; Human Rights Watch, Neither
Rights nor Security: Killings, Torture, and Disappearances in Mexico’s “War on Drugs,” November 2011, available
at: http://www.hrw.org/sites/default/files/reports/mexico1111webwcover_0.pdf. Hereinafter HRW, November 2011.
83
U.S. Department of State, Country Reports on Human Rights Practices for 2011, Washington, DC, May 24, 2012,
http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index.htm#wrapper. Hereinafter: Country Report: Mexico, 2011.
84
Eduardo Guerrero Gutiérrez, “Las Cárceles y el Crimen,” Nexos, April 1, 2012.

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police from being re-hired; the use of internal affairs units; and the provision of human rights
training. In 2012, the government also announced new protocols on the use of force and how
detentions are to be handled that were designed to prevent abuses. A January 2009 public security
law codified vetting requirements and professional standards for state police to be met by 2013,
but progress toward meeting those standards has been uneven. With a few exceptions, efforts to
reform municipal police forces have lagged behind.
There has also been increasing concern that the Mexican military, which is less accountable to
civilian authorities than the police, is committing more human rights abuses since it is has been
tasked with carrying out public security functions. A November 2011 Human Rights Watch
(HRW) report maintains that cases of torture, enforced disappearances, and extrajudicial killings
have increased significantly in states where federal authorities have been deployed to fight
organized crime.85 According to Mexico’s Human Rights Commission (CNDH), the number of
complaints of human rights abuses by Mexico’s National Defense Secretariat (SEDENA)
increased from 182 in 2006 to a peak of 1800 in 2009 before falling slightly to 1,695 in 2011. The
Trans-Border Institute has found that the number of abuses by SEDENA forces that have been
investigated and documented by CNDH has also declined since 2008-2009, particularly in areas
where large-scale deployments have been scaled back.86 In contrast, complaints of abuses against
the Secretariat of the Navy (SEMAR) reported to CNDH increased by 150% from 2010 to 2011
as its forces became more heavily involved in anti-DTO efforts.87 While troubling, only a small
percentage of those allegations have resulted in the CNDH issuing recommendations for
corrective action to SEDENA or SEMAR, which those agencies say they have largely accepted
and acted upon.88 A June 2011 constitutional amendment gave CNDH the authority to force
entities that refuse to respond to its recommendations to appear before the Mexican Congress.
In addition to expressing concerns about current human rights abuses, Mexican and international
human rights groups have criticized the Mexican government for failing to hold military and
police officials accountable for past abuses.89 In addition to taking steps to reform the police and
judiciary, the Calderón government took some steps to comply with rulings by the Inter-American
Court of Human Rights (IACHR) that cases of military abuses against civilians should be tried in
civilian courts. While a few dozen cases90 were transferred to civilian jurisdiction and former
President Calderón asked SEDENA and SEMAR to work with the Attorney General to accelerate
transfers, most cases were still processed in the military justice system.91 Military prosecutors

85

HRW, November 2011.
Catherine Daly, Kimberly Heinle, and David A. Shirk, Armed with Impunity: Curbing Military Human Rights Abuses
in Mexico, Trans-Border Institute, 2012, available at:
http://justiceinmexico.files.wordpress.com/2012/07/12_07_31_armed-with-impunity.pdf, P. 21.
87
Benito Jiménez, “Acumula Marina Quejas por Abusos,” Reforma, March 5, 2012.
88
In 2011, for example, the 1,695 complaints filed with CNDH against SEDENA resulted in 25 recommendations.
Country Report: Mexico, 2011, p. 8.
89
HRW, Uniformed Impunity: Mexico's Misuse of Military Justice to Prosecute Abuses in Counternarcotics and Public
Security Operations, 2009, available at: http://www.hrw.org/sites/default/files/reports/mexico0409web_0.pdf.
90
Those cases include emblematic cases involving Rosendo Radilla Pacheco; Inés Fernandez Ortega; Valentina
Rosendo Cantu; Nitza Paula Alvarado Espinoza, Rocio Irene Alvarado Reyes, Jose Angel Alvarado Herrera; and
Ramiro Ramirez.
91
For background, see: Maureen Meyer, Recent Developments on the Use of Military Jurisdiction in Mexico, WOLA,
January 31, 2012.
86

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have opened thousands of investigations into allegations of human rights abuses as a result of
complaints filed with the CNDH, with few having resulted in convictions.92
A reform of Article 57 of the military justice code was submitted by then-President Calderón in
October 2010 mandating that at least certain human rights violations be investigated and
prosecuted in civilian courts. A more comprehensive proposal that required that all cases of
alleged military human rights violations be transferred to the civilian justice system was approved
by the Mexican Senate’s Justice Commission in April 2012; however, the bill was subsequently
blocked from coming to a vote. In September 2012, another proposal to reform Article 57 was
presented in the Mexican Senate, but not enacted. Enacting a reform of Article 57 of the military
justice code may become more urgent now for the Peña Nieto Administration now that Mexico’s
Supreme Court is in the process of establishing binding legal precedent for determining
jurisdiction in cases involving alleged military human rights violations against civilians.
Human rights defenders and journalists have been particularly vulnerable to abuses by organized
crime, sometimes acting in collusion with corrupt government authorities. Recently, several
prominent human rights defenders have been harassed, attacked, and even killed, including
members of the high-profile Movement for Peace with Justice and Dignity led by Javier Sicilia.
Increasing violent crimes targeting journalists, combined with high levels of impunity for the
perpetrators of those crimes, have made Mexico the most dangerous country in the Western
Hemisphere for journalists. Crimes against journalists range from harassment, to extortion, to
kidnapping and murder. The Committee to Protect Journalists (CPJ) has documented 58 murders
of journalists and at least 10 cases of journalists disappearing in Mexico since 2000. Threats from
organized crime groups have made journalists and editors fearful of covering crime-related
stories, and in some areas coverage of the DTOs’ activities have been shut down.93
The Calderón government and the Mexican Congress took some steps to better protect human
rights defenders and journalists, but many human rights organizations have called upon the Peña
Nieto Administration to do more. The Calderón government established a special prosecutor
within the Attorney General’s Office to attend to crimes against freedom of expression and
created mechanisms to provide increased protection for journalists and human rights defenders.
Those mechanisms have yet to be effectively implemented. The Mexican Congress enacted a law
to make crimes against journalists a federal offense and a law to require the federal government to
provide protection to journalists and human rights defenders who are “at risk” of being victimized
and to their families. Another law approved by the Congress in 2012, but not promulgated by the
Calderón government, would require the state to track victims of organized crime and provide
assistance to victims and their families. Human rights organizations expressed satisfaction after
President Peña Nieto signed that law, commonly referred to as the “victims’ law,” in January
2013, but said that the real test of his government’s commitment to human rights will be in how
that and other laws are implemented.94

92

As of September 2012, SEDENA had convicted two mid-grade officer, five junior officers, and 31 enlisted soldiers
as a result of CNDH recommendations.
93
Committee to Protect Journalists, Silence or Death in Mexico’s Press: Crime, Violence, and Corruption are
Destroying the Country’s Journalism, September 2010. Mexico’s inability to protect journalists prompted the country
to be downgraded from “partly free” to “not free” in Freedom House’s 2011 global survey on freedom of expression.
94
“Mexico: New President, New Drug Violence Plan,” NPR, January 17, 2013.

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Human Rights Conditions on U.S. Assistance to Mexico
In 2008, Congress debated whether human rights conditions should be placed on Mérida
assistance beyond the requirements in §620J of the Foreign Assistance Act (FAA) of 1961. That
section was re-designated as §620M and amended by the Consolidated Appropriations Act of
2012 (P.L. 112-74). It states that an individual or unit of a foreign country’s security forces is
prohibited from receiving assistance if the Secretary of State receives “credible evidence” that an
individual or unit has committed “a gross violation of human rights.”
The FY2008 Supplemental Appropriations Act (P.L. 110-252), which provided the first tranche of
Mérida funding, had less stringent human rights conditions than had been proposed earlier,
largely due to Mexico’s concerns that some of the conditions would violate its national
sovereignty. The conditions required that 15% of INCLE and Foreign Military Financing (FMF)
assistance be withheld until the Secretary of State reports in writing that Mexico is taking action
in four human rights areas:
1. improving transparency and accountability of federal police forces;
2. establishing a mechanism for regular consultations among relevant Mexican
government authorities, Mexican human rights organizations, and other relevant
Mexican civil society organizations, to make consultations concerning
implementation of the Mérida Initiative in accordance with Mexican and
international law;
3. ensuring that civilian prosecutors and judicial authorities are investigating and
prosecuting, in accordance with Mexican and international law, members of the
federal police and military forces who have been credibly alleged to have
committed violations of human rights, and the federal police and military forces
are fully cooperating with the investigations; and
4. enforcing the prohibition, in accordance with Mexican and international law, on
the use of testimony obtained through torture or other ill-treatment.
Similar human rights conditions were included in FY2009-FY2011 appropriations measures that
funded the Mérida Initiative.95 However, the first two conditions are not included in the 15%
withholding requirement in the FY2012 Consolidated Appropriations Act (P.L. 112-74). As
previously mentioned, Congress has yet to pass a final FY2013 appropriations measure. It
remains to be seen whether an omnibus bill would include the conditions on aid to Mexico that
are in the Senate Appropriations Committee’s version of the FY2013 foreign operations
95
In P.L. 110-252, the human rights conditions applied to 15% of the funding for INCLE and FMF, or approximately
$57 million dollars. In the FY2009 Omnibus Appropriations Act (P.L. 111-8), the 15% conditions applied all of the
funding accounts but excluded amounts for judicial reform, institution building, anti-corruption and rule of law
activities, which were earmarked at not less than $75 million. The total aid withheld was $33.4 million. In the FY2009
Supplemental (P.L. 111-32), the conditions effectively only applied to the $160 million in the INCLE account, or
roughly $24 million, because the $260 million in FMF funds was excluded from the 15% withholding requirement. In
the FY2010 Consolidated Appropriations Act (P.L. 111-117), the 15% withholding applied to all of the accounts but
excluded assistance for judicial reform, institution building, anti-corruption and rule of law activities. The total aid
withheld was some $12 million. In the FY2010 Supplemental Appropriations Act (P.L. 111-212), the conditions
applied to 15% of the INCLE appropriated or roughly $26 million. The same conditions that were included in P.L. 111117 applied to assistance provided in the FY2011 Department of Defense and Full-Year Continuing Appropriations Act
(P.L. 112-10). According to the State Department, the FY2011 funds on hold totaled approximately $3.5 million. Email
from State Department official, January 24, 2012.

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appropriations measure S. 3241 (S.Rept. 112-172). Those conditions would retain the condition
related to torture, as well as require the State Department to report that Mexico has reformed its
military justice code and is requiring police and military officials to immediately transfer
detainees to civilian judicial authorities.
Thus far, the State Department has submitted three 15% progress reports on Mexico to
congressional appropriators (in August 2009, September 2010, and August 2012) that have met
the statutory requirements for FY2008-FY2012 Mérida funds that had been on hold to be
released. Nevertheless, the State Department has twice elected to hold back some funding
pending further progress in key areas of concern. In the September 2010 report, for example, the
State Department elected to hold back $26 million in FY2010 supplemental funds as a matter of
policy until further progress was made in the areas of transparency and combating impunity.96
Those funds were not obligated until the fall of 2011.
In the August 2012 report, the State Department again decided to hold back all of the FY2012
funding that would have been subject to the conditions (roughly $18 million) as a matter of policy
until it can work with Mexican authorities to determine steps to address key human rights
challenges. Those include: improving the ability of Mexico’s civilian institutions to investigate
and prosecute cases of human rights abuses; enhancing enforcement of prohibitions against
torture and other mistreatment; and strengthening protection for human rights defenders.97
The State Department has established a high-level human rights dialogue with Mexico, provided
human rights training for Mexican security forces (at least eight hours for every course offered),
and implemented a number of human rights-related programs. For example, USAID has provided
$1.3 million to the U.N. Office of the High Commissioner for Human Rights to help civil society
groups monitor abuses by security forces and to improve how security agencies respond to those
abuses. In 2011, USAID launched a $5 million program being implemented by Freedom House to
improve protections for Mexican journalists and human rights defenders.
Congress may choose to augment Mérida Initiative funding for human rights programs, such as
ongoing human rights training programs for military and police, or newer efforts, such as support
for human rights organizations through ESF funds. Human rights conditions in Mexico, as well as
compliance with conditions on Mérida assistance, are also likely to continue to be important
oversight issues as well. Policy makers may closely follow how the Peña Nieto moves to punish
past human rights abuses and prevent new abuses from occurring.

96

In the September 2010 15% report, the State Department urged the Mexican Congress to approve pending legislation
that would strengthen the power of the CNDH and the Calderón government to submit legislation to reform the
Military Justice Code so that military officials accused of human rights crimes against civilians would be tried in
civilian courts. The Mexican Congress approved a series of reforms that elevate human rights conditions in
international treaties signed by Mexico to the level of the constitution and strengthen the power of the CNDH and statelevel human rights commissions. The reforms were promulgated in June 2011. A reform of Article 57 of the military
justice code was submitted by President Calderón in October 2010 mandating that at least certain human rights
violations be investigated and prosecuted in civilian courts. A more comprehensive proposal that required that all cases
of alleged military human rights violations be transferred to the civilian justice system was approved by the Mexican
Senate’s Justice Commission in April 2012; however, the bill was subsequently blocked from coming to a vote. In
September 2012, another proposal to reform Article 57 was presented in the Mexican Senate as it began its first period
of sessions with its new members.
97
U.S. Department of State, Mexico- Merida Initiative Report (“15 Percent” Report), August 30, 2012.

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Migration98
Trends in Mexican Immigration to the United States
Mexico is the leading country of origin among U.S. legal permanent residents (LPRs) and among
unauthorized immigrants in the United States, according to the Department of Homeland Security
Office of Immigration Statistics (OIS). While the Immigration and Nationality Act (INA) sets a
ceiling on immigration from any one country at 7%, most Mexican immigrants are exempt from
the statutory numerical limits because they enter as immediate relatives of U.S. citizens.
Mexicans made up 62% of the unauthorized aliens living in the United States in 2010 according
to estimates based upon the American Community Survey (ACS) of the U.S. Census Bureau. OIS
demographers estimated from the ACS that there were 6.7 million Mexican nationals among the
estimated 10.8 million unauthorized resident population in 2010.99
Mexican migration flows, particularly unauthorized flows, began to decline in mid-2006 and have
continued on a downward trajectory since that time. In fact, data from multiple sources estimate
that the net rate of unauthorized migration from Mexico to the United States is fluctuating
somewhere near zero.100 Researchers have variously attributed this declining emigration to the
U.S. recession, to stepped up U.S. border security that has made the journey more hazardous, to
increasing abuses of migrants by smugglers and criminal organizations, and to expanding job
opportunities in Mexico.101 Emigration flows may increase again once economic growth picks up
in the United States. However, future flows may be smaller than in the past because young
Mexicans may feel less pressure than previous generations to emigrate in order to find work.

Mexico’s Immigration Policies
Mexico is in a unique position in the international migration system because in addition to its role
as a source of international emigrants, it is also an important country of transit and, to a lesser
extent, a destination country for transnational migrants. Most transit migration though Mexico
consists of unauthorized migration of U.S.-bound Central American migrants. Unauthorized
flows peaked in 2005, when there were roughly 430,000 illegal crossings into Mexico from
Central America, before falling to an estimated 140,000 crossings in 2010.102 Flows have declined
98

For more information, see: CRS Report R42560, Mexican Migration to the United States: Policy and Trends,
coordinated by (name redacted).
99
Department of Homeland Security, Office of Immigration Statistics, Estimates of the Unauthorized Immigrant
Population Residing in the United States: January 2010, by Michael Hoefer, Nancy Rytina, and Bryan C. Baker, 2011,
available at: http://www.dhs.gov/xlibrary/assets/statistics/publications/ois_ill_pe_2010.pdf. For alternative analyses,
see Jeffrey S. Passel and D'Vera Cohn, Unauthorized Immigrant Population: National and State Trends, 2010, Pew
Hispanic Center, February 1, 2011, http://pewhispanic.org/files/reports/133.pdf.
100
Data from the U.S. Department of Homeland Security, the Pew Hispanic Center, the Mexican Migration Project at
Princeton University, Mexico’s 2010 Census, and Mexico’s Northern Border International Migration (EMIF) survey
support this finding.
101
See, for example: Jeffrey Passel and D'Vera Cohn, Mexican Immigrants: How many Come? How Many Leave?,
Pew Hispanic Center, July 2009, pewhispanic.org/files/reports/112.pdf; Damien Cave, “Better Lives for Mexicans Cut
Allure of Going North,” New York Times, July 6, 2011; David Scott Fitzgerald, Rafael Alarcón, and Leah MuseOrlinoff, Recession Without Borders: Mexican Migrants Confront the Economic Downturn (La Jolla, CA and Boulder,
CO: Center for Comparative Immigration Studies (CCIS) and Lynne Reiner Publishers, 2011), p. 19.
102
Gobierno Federal de México, Secretaria de Gobernación (SEGOB), Apuntes Sobre Migración, July 1, 2011;
SEGOB, Boletín Mensual de Estadísticas Migratorias, 2005-2010.

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for many of the same reasons that Mexico-U.S. emigration has declined, but particularly due to
the fears that potential Central American migrants now have about being victimized by organized
criminal groups in Mexico.103
Until recently, Mexico lacked a cohesive migration policy, and successive Mexican governments
appeared to express little concern about the number of Mexican citizens leaving for the United
States without proper documents and often at great personal risk.104 Beginning in the late 1990s,
however, increasing emigrant deaths along the U.S.-Mexico border and the precarious situation of
unauthorized Mexican migrants in the United States led the Mexican government to take a more
active and comprehensive approach to migration issues, including through greater engagement
with the United States and reforms to its own migration policy.105

The “Whole Enchilada” Framework
Vicente Fox’s election in 2000 ended 71 years of one-party rule and his government made
reaching a U.S.-Mexico immigration agreement a top priority. Fox and President George W. Bush
met five times during the first nine months of 2001, and on September 6, 2001, the two presidents
announced a framework agreement to negotiate a major bilateral migration accord.106 Although
the possibility of a U.S.-Mexico migration accord faded after the 9/11 terrorist attacks, the
Mexican government supported efforts to enact comprehensive immigration reform in the United
States. In February 2006, for example, the Mexican Congress passed a Concurrent Resolution on
Migration acknowledging Mexico’s shared responsibility to enforce legal emigration, increase
security along its northern and southern borders, and create opportunities for workers in Mexico
so that fewer individuals would emigrate.107 In exchange for these commitments, the resolution
called for the development of a U.S. guest worker program.

Recent Migratory Reforms and 2011 Immigration Law
Between 2006 and 2011, the Calderón Administration and the Mexican Congress took significant
steps to overhaul Mexico’s migration policies, although the implementation of recent reforms
remains a work in progress.108 Previously, Mexico’s primary immigration law, the General
Population Act of 1974, limited legal immigration and restricted the rights of foreigners in
Mexico, with unauthorized migrants subject to criminal penalties. A 2007 law made human
103

Organization of American States, International Migration in the Americas: SICREMI 2011 Country Reports, 2011.
For information on how Mexico’s approach to U.S.-Mexico migration issues has historically ebbed and flowed, see:
(name redacted),
Obstacles and Opportunities for Regional Cooperation: The US-Mexico Case, MPI, April 2011,
available at: http://www.migrationpolicy.org/pubs/USMexico-cooperation.pdf.
105
This section is drawn from: Laura V. González-Murphy and Rey Koslowski, Entiendo el Cambio a las Leyes de
Inmigración de México, Woodrow Wilson International Center for Scholars Mexico Institute, March 2011; Marcelle
Beaulieu, “Mexican Immigration Policy: Candil de la Calle, Oscuridad de la Casa,” (Ph.D. diss., Tulane University,
forthcoming).
106
The White House, Joint Statement between the United States of America and the United Mexican States,
http://georgewbush-whitehouse.archives.gov/news/releases/2001/09/20010906-8.html.
107
An English translation of the resolution is available at
http://hirc.house.gov/archives/109/Mexico%20Migration%20Phenomenon.pdf.
108
Beaulieu, op. cit. For comments on Mexico’s recent efforts, see: The United Nations Office at Geneva, “Committee
on the Rights of Migrant Workers Considers Report of Mexico,” press release, April 5, 2011,
http://www.unog.ch/80256EDD006B9C2E/(httpNewsByYear_en)/20DEDEC635336C4EC1257869004679DE?OpenD
ocument.
104

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Mexico and the 112th Congress

trafficking a criminal offense at the federal level, and by 2010, all 32 Mexican states had enacted
some form of anti-trafficking reform. In 2008, the Mexican Congress reformed the General
Population Act to decriminalize simple migration offenses, making unauthorized migrants subject
to fines and voluntary repatriation or deportation, but no longer subject to imprisonment. That
year the Calderón government also announced a new strategy and more than $200 million in new
investments to improve security conditions, modernize customs and immigration installations,
and promote development in Mexico’s southern border region. In 2010, Mexico’s Congress
passed a law stiffening penalties for alien smuggling, particularly abuses committed by public
officials. Efforts to identify and punish corrupt officials who may have abused migrants have
advanced a bit further at the federal level than in most states and municipalities.
The long-term results of Mexico’s recent migratory reform efforts are likely to hinge on how well
the Mexican government is able to implement a new immigration law that was unanimously
approved by the Mexican Congress and signed by President Calderón in May 2011.109 Some of
the main objectives of the law are to (1) guarantee the rights and protection of all migrants who
transit Mexican territory; (2) simplify the procedures governing migration in Mexico to facilitate
legal immigration; (3) establish the principles of family reunification and humanitarian protection
as key elements of the country’s immigration policy; and, (4) delineate the roles of each entity
responsible for aspects of migration policy so as to improve migration management and reduce
abuses of migrants by public officials.110
The first and fourth objectives most directly respond to the criticisms that have been leveled
against the Mexican government for failing to adequately prevent, investigate, and punish abuses
of migrants by public officials and organized crime groups. Within the first objective, the law
guarantees all migrants access to education, justice, and healthcare services and reduces the time
that unauthorized migrants can be held in detention centers to 15 working days. The law also
gives legal status to special government “Beta Groups”111 that assist migrants in distress and
establishes special procedures for how children and other vulnerable groups should be treated.
Under the fourth objective, the law gives INM legal authority to enforce immigration policy and
stipulates that only federal immigration officials can ask for documents to verify a migrant’s
status.

Efforts to Enact Immigration Reform in the United States
As previously stated, since the mid-2000s, the Mexican government has supported efforts to enact
comprehensive immigration reform in the United States. Comprehensive bills have generally
addressed border security, enforcement of immigration laws within the United States,
employment eligibility verification, temporary worker programs, permanent admissions and, most
controversially, unauthorized aliens in the United States.
Despite President Obama's stated commitment to pursue comprehensive immigration reform,
immigration was not a front-burner issue for the 112th Congress. A comprehensive immigration
reform bill (S. 1258) and DREAM Act bills (S. 952, H.R. 1842, and H.R. 3823) were introduced
109

For a general description of the law in English, see: Gobierno Federal de México, “Mexico’s New Law on
Migration,” September 2011, available at: http://usmex.ucsd.edu/assets/028/12460.pdf.
110
CRS translation of a briefing document prepared by INM in response to a CRS request.
111
Beta Groups were first established to assist migrants along the U.S.-Mexico border in 1990 and expanded to
Mexico’s Southern border region in the mid-1990s. In 2010, “Beta Groups” rescued 4,163 migrants in distress.

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in the 112th Congress, but not considered. The 112th Congress did take legislative action on some
measures containing provisions on a range of immigration-related topics.112
On June 15, 2012, the Obama Administration announced that certain individuals who were
brought to the United States as children and meet other criteria similar to those included in
DREAM Act bills would be considered for relief from removal. Under a memorandum issued by
Secretary of Homeland Security Janet Napolitano on that date, these individuals would be eligible
for deferred action for two years, subject to renewal, and could apply for employment
authorization. The deferred action process set forth in the June 15, 2012, memorandum, however,
would not grant eligible individuals a legal immigration status.
Former President Calderón did not promise Mexicans that he could affect immigration reform
efforts in the U.S. Congress or reach a bilateral accord with the Obama Administration. He saw
how former President Vicente Fox’s failure to secure a bilateral immigration accord with the
United States in 2001 proved to be a major blow to his administration.113 Incoming President
Peña Nieto has pledged his full support for President Obama’s pledge to introduce comprehensive
reform, and is likely to continue Mexico’s efforts to improve border security, enforce its
migration policies in a humane way, and create jobs in order to discourage illegal emigration. His
government is also likely to continue protesting the excessive use of force by U.S. agents on the
border; defending the rights of Mexican migrants in the United States, regardless of their status;
and challenging state laws against illegal immigration.114

Energy and Environmental Issues
Oil Production in Mexico and Efforts to Reform PEMEX
The future of oil and gas production in Mexico is of great importance for Mexico’s economic
stability and for U.S. energy security; Mexico is consistently a top U.S. crude oil supplier.
Mexico’s state oil company, PEMEX, established in 1938 as the world’s first major national oil
company, remains an important source of government revenue, but is struggling to counter the
country’s declining oil production. Production reached a peak of 3.48 million barrels per day in
2004 and has been declining since then, falling to 2.96 million barrels per day in 2011.115
Policy experts have long urged Mexico to reduce the heavy fiscal burdens on PEMEX and to
reform the constitution to enable PEMEX to pursue joint ventures with foreign oil companies that
have the technological experience and capital required for oil and gas exploration and production.
However, numerous stakeholders in Mexico are concerned that increasing private involvement in
112
For information, see: CRS Report R42036, Immigration Legislation and Issues in the 112th Congress, coordinated
by (name redacted).
113
President Fox and President George W. Bush met five times during the first nine months of 2001, and on September
6, 2001, the two presidents announced a framework agreement to negotiate a major bilateral migration accord. The
agreement would have included a Mexico-specific temporary worker program, collaborative border enforcement,
legalization for certain unauthorized Mexicans in the United States, and new investments in Mexican communities of
origin aimed at reducing illegal outflows. The possibility of a U.S.-Mexico migration accord faded after the 9/11
terrorist attacks.
114
The Mexican government has filed amicus curiae briefs in lawsuits seeking to block the immigration laws in
Arizona, Alabama, Georgia, South Carolina, and Utah.
115
United States Energy Information Administration data, available at http://www.eia.gov.

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PEMEX could threaten Mexico’s constitutionally protected control over its natural resources.
Legislators from the left and center have derailed most oil and gas sector reform efforts
introduced, despite limited reforms being enacted by the Calderón Administration in 2008. Those
reforms brought private sector experts into PEMEX’s management structure, created an
independent board to advise the company, and added greater flexibility to its procurement and
investment processes. Most significantly, the 2008 reforms permit PEMEX to create incentivebased service contracts with private companies.116
Many analysts contend, however, that the reforms did not go far enough and that they do little to
help the PEMEX address its major challenges.117 Most experts contend that PEMEX only has the
capacity to extract oil or gas in shallow waters and needs to bring in new technologies and knowhow through private investment to allow the company to successfully explore and produce in the
deep waters in the Gulf of Mexico. The lack of further reforms is keeping Mexico from allowing
much-needed foreign investment in oil exploration. Though the performance-based contracts are
expected to increase production and reserves, PEMEX faces serious challenges in finding new,
productive wells and engineering capacity.
Enacting energy reforms is a task which President Peña Nieto has said will be a top priority for
his administration in 2013. However, constitutional reforms require a two thirds vote in the
Mexican Congress. The PRI-led coalition’s failure to capture a majority in either chamber of the
Congress may mean that Peña Nieto will encounter the same type of opposition to his reformist
agenda that Calderón has experienced, unless he is able to reach agreements with the PAN. The
PRD and portions of the PRI remain opposed to increasing private involvement in PEMEX. Some
predict that Peña Nieto may move to implement reforms that have broad based support, such as
making PEMEX’s budget more independent and reducing its tax burden as part of a larger fiscal
reform effort, before pushing for greater private cooperation with PEMEX.118

U.S.-Mexican Energy and Environmental Cooperation
The United States and Mexico have been collaborating on geothermal energy projects since the
1970s, but the possibility of expanding joint efforts to produce renewable energy sources has just
recently returned to the bilateral agenda. On April 16, 2009, President Obama and Mexican
President Calderón announced the Bilateral Framework on Clean Energy and Climate Change to
jointly develop clean energy sources and encourage investment in climate-friendly technologies.
Among others, its goals include enhancing renewable energy, combating climate change, and
strengthening the reliability of cross-border electricity grids. Bilateral meetings to advance the
Framework were held in January 2010, May 2011, and May 2012. There is particular interest on
both sides in ensuring that Mexico is able to develop unconventional energy sources in an
environmentally responsible way and in overseeing 10 new projects related to wind and solar
energy that the North American Development Bank has helped f

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3ARL32724. Public record. Not legal advice.