President-elect Donald Trump declared that he would impose 100% tariffs or demand nations in the BRICS group of developing economies, which is supported by China and Russia, to pledge not to create new currencies while in office.
“The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER. We require a commitment from these Countries that they will neither create a new BRICS Currency, nor back any other Currency to replace the mighty U.S. Dollar or, they will face 100% Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy,” Trump posted on Truth Social on Saturday afternoon.
Since 2011, the countries of Brazil, Russia, India, China, and South Africa have been known as BRICS. Iran, Saudi Arabia, the United Arab Emirates, Ethiopia, and Egypt formally joined earlier this year, marking the first growth in more in ten years. In February, South African Foreign Minister Naledi Pandor announced that 34 nations have expressed interest in joining the group of large emerging economies.
In order to lessen dependency on the US dollar, Luiz Inácio Lula da Silva, the leader of one of the member nations, Brazil, suggested in 2023 that South America adopt a single currency.
Member nations like China, Iran, and Russia may be able to get around Western sanctions by using BRICS currencies and financial networks that are not denominated in US dollars. However, given the alliance’s economic and geopolitical disparities, the likelihood of a new currency is likely low.
China finds the growing organization useful as it seeks to strengthen ties with important figures in order to undermine American dominance in the world. Additionally, it benefits Russia, which the West has spurned politically and economically since its invasion of Ukraine in 2022. Russia took over the group’s rotational chairmanship this year.
Chinese leader Xi Jinping and Russian President Vladimir Putin aimed to convey at a BRICS summit in October that the West is alone in the world and that the “global majority” of nations back their attempt to unseat American dominance.
Trump’s most recent economic threat follows his announcement on the first day of his office that he would impose significant tariff increases on commodities originating from China, Canada, and Mexico. Trump claimed that the action would be taken in response to “crime and drugs” and illegal immigrants crossing the border.
Trump and Mexican President Claudia Sheinbaum had their first conversation since the tariff announcement, but their responses to the discussion have been mixed. In the meantime, Canadian Prime Minister Justin Trudeau visited Trump at his Mar-a-Lago resort in Florida. The president-elect described the Friday meal with Trump as a “very productive meeting,” while Trudeau said it “was an excellent conversation.”
