President-elect Donald Trump has issued a stark warning to BRICS nations, threatening 100% tariffs if the bloc pursues plans to create a common currency that could undermine the dominance of the US dollar. The statement, made via Trump’s Truth Social platform, signals a potential intensification of trade tensions during his upcoming administration.
Trump’s Ultimatum
Trump declared that the United States would not allow the BRICS bloc—comprising Brazil, Russia, India, China, and South Africa, alongside new members Iran, the UAE, Ethiopia, and Egypt—to proceed with any attempts to develop a new currency. “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,” he wrote, warning that failure to comply would result in severe economic repercussions.
He also emphasized the strategic importance of maintaining the US dollar as the world’s primary reserve currency, stating, “The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER.”
Growing BRICS Aspirations
Since its inception, BRICS has aimed to provide an alternative platform for emerging economies to counterbalance Western financial systems. This year, the group expanded for the first time in over a decade, with several countries joining and dozens expressing interest.
Leaders within BRICS have proposed initiatives to reduce reliance on the US dollar, including suggestions for a common currency. Brazilian President Luiz Inácio Lula da Silva advocated for a South American currency in 2023, while discussions at various summits have explored the use of national currencies for trade.
However, internal differences within BRICS have hampered such ambitions. Speaking ahead of the October BRICS summit in Russia, President Vladimir Putin admitted the bloc was not actively considering the creation of a common currency. “Its time has not come yet,” he stated, emphasizing a gradual approach and enhanced cooperation between central banks.
Strategic Implications for China and Russia
The BRICS platform holds strategic value for China and Russia. For China, it represents a pathway to build alliances that challenge US dominance in global affairs. For Russia, isolated economically and diplomatically due to the Ukraine conflict, BRICS offers an avenue to forge partnerships outside Western sanctions.
During the October summit, both Putin and Chinese President Xi Jinping emphasized their intent to project BRICS as a counterweight to Western influence, underscoring their vision of a “global majority” opposed to US hegemony.
Broader Economic Threats
Trump’s warning to BRICS comes as part of a broader strategy of economic pressure. Days earlier, he announced sweeping tariff hikes on goods from Mexico, Canada, and China, citing issues like illegal immigration and cross-border crime.
Mexican President Claudia Sheinbaum and Trump recently engaged in a tense discussion over the proposed tariffs, with conflicting accounts of the call’s outcome. Meanwhile, Canadian Prime Minister Justin Trudeau met with Trump in Florida, describing their dialogue as “productive.”
Correction on Saudi Arabia’s BRICS Status
In a related clarification, Saudi Arabia was reported as having joined BRICS earlier this year. However, it was later confirmed that the kingdom was invited but has yet to formally become a member.
As the Trump administration prepares to take office, these developments suggest that international trade and currency politics will be central to the next four years. For BRICS, the path forward remains fraught with challenges, as the alliance weighs its ambitions against potential fallout from the United States.
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