Innovate or Be Left Behind: 2025 Puts Local Government in Mexico and the U.S. to the Test
- Editorial
- Aug 13
- 3 min read
Public-sector innovation is no longer cosmetic—it’s the difference between a government that delivers and one that falls behind. In 2025, the binational picture is clear. In Mexico, the launch of Llave MX and the creation of the Digital Transformation and Telecommunications Agency are steering the country toward streamlined procedures and data interoperability at the federal level. Authorities have promised to digitize up to 80% of procedures and cut processing times by 50%—an ambition that, translated to municipal service counters, would mean lower costs, shorter lines, and less discretion on the street. In the United States, connectivity remains front and center: in January 2025, the Department of Commerce refined guidance for the BEAD program to allow “alternative” technologies (such as LEO satellites) in remote areas, with all the debates about cost, quality, and equity that entails.
The 2024 scorecard offers concrete lessons. In the U.S., ICMA surveyed local executives and found that 48% considered AI a low priority, while fewer than 6% saw it as high. Only 10% had designated someone to coordinate AI and just 9% had an institutional policy. Where they do see immediate value is in constituent services (55%) and budget modeling (38%); the biggest hurdles are lack of know-how (77%) and fear of misinformation (70%). These numbers explain why many city halls remain in “pilot mode” rather than full implementation. Even so, the 2024 Digital Cities Survey recorded that, on average, 24% of cities have moved from pilots to AI deployment; the top use is threat detection (75%), followed by natural language processing (37%) and sentiment analysis (36%).
Priorities for 2025: cybersecurity, citizen experience, and process automation.
Complementing this, the What Works Cities network raised the bar for data-driven management: 74 cities had earned certification at the start of 2024, a useful benchmark for mayors seeking to professionalize decision-making.
On the Mexican side, Mexico City offers a lab that applies to mid-sized municipalities: Llave CDMX has 6.3 million users and more than 200 digital procedures and services, with massive transactions in driver’s licenses, scholarships, and vehicle registration cards. The achievement isn’t just technological—it’s managerial and regulatory design to curb discretion at service windows. The national expansion of Llave MX opens the door for municipalities to integrate digital identity and a single, unified record; the challenge will be ensuring interoperability, data protection, and resilience to cyberattacks (issues already in the public conversation since 2024) without slowing adoption.
What do these advances mean in political and economic terms?
First, institutional productivity: fewer in-person procedures free up public servants’ time and reduce operating costs.
Second, legitimacy: the capacity to respond (quickly and with information) boosts trust and narrows the space for petty corruption.
Third, territorial competitiveness: municipalities that integrate data, digital identity, and electronic payments attract investment and speed up permits, works, and urban services.
But 2025 won’t be simple. The connectivity gap (critical in rural and peri-urban areas) will depend on how BEAD is executed and the standards adopted by states; the technical and regulatory choices made in the coming months will determine whether local governments operate on robust fiber or less stable solutions. In addition, states must submit their final BEAD proposals in the second half of 2025, which will shape municipal timelines for digitizing broadband-based services. In Mexico, the challenge is taking the federal agenda down to the local level: if digital identity remains stuck at state counters, municipalities will keep capturing photocopies and validating by hand. Cybersecurity requires budgets, talent, and protocols (not just statements) and tight coordination with data-protection authorities.
What should a border city council or a midsize Bajío city do?
One, data governance: inventory critical data, define owners, catalogs, and access tiers; follow certification frameworks that already measure practices, such as What Works Cities, to avoid reinventing the wheel.
Two, AI policies before procurement: use cases with metrics, risk and bias assessments, contracts with auditability and exit clauses; if there’s no AI lead, appoint one.
Three, interoperable architecture: digital identity, payments, and notifications as “common layers” on which any department can build services; technically, open APIs and standards; politically, interagency compacts.
The culture of innovation isn’t a hackathon; it’s discipline. Mayors who understand that 2025 is the year to operate at scale (assured connectivity, functional identity, and automated processes) will turn their governments into reliable service platforms. The rest—even if they buy technology—will still be managing queues.
Written by: Editorial
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