Donald Trump said there is ‘no chance that the Brics will replace the US dollar in international trade.
By: Saneliso Mlambo
The elected US president, Donald Trump (78) threatened the BRICS group of emerging-market nations on Saturday, warning that he would impose 100% tariffs if they make any moves to undermine the U.S. dollar.
In a post on Truth Social, Trump said the 100% tariff would affect all BRICS countries (Brazil, Russia, India, China, South Africa, Iran, Egypt, Ethiopia and the United Arab Emirates) until they commit to not creating a new BRICS currency or back another currency that could replace the “mighty” dollar.
The warning came less than a week after Trump declared he would impose tariffs on Canada, Mexico and China once he was inaugurated as president.
Officials from the BRICS countries have discussed moving away from the U.S. dollar in recent years including at the 2024 BRICS Summit meeting. The concept gained steam in 2022 when the U.S. imposed massive economic sanctions on Russia over its war in Ukraine.
Using BRICS currencies and banking networks outside the US dollar-denominated system could allow member countries such as Russia, China and Iran to circumnavigate Western sanctions. But the chances of a new currency are probably slim due to the alliance’s economic and geopolitical differences.
A 100% tariff at the US border, if implemented, would drive up sharply the cost of goods from Brics members, fuelling US inflation and destabilising global trade flows.
Trump’s latest economic threat comes days after he pledged massive hikes in tariffs on goods coming from Mexico, Canada and China starting on the first day of his administration. The move, Trump said, will be in retaliation for illegal immigration and “crime and drugs” coming across the border.