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- Trump warns BRICS nations against creating a new currency, threatening 100% tariffs and market access loss.
- BRICS explores gold and digital assets to reduce reliance on the US dollar in global trade.
President-elect Donald Trump has issued a strong warning to the BRICS nations, claiming that their efforts to undermine the US dollar’s dominance are over.
Trump’s remarks coincide with escalating actions by BRICS—Brazil, Russia, India, China, South Africa, and their new members Saudi Arabia, the UAE, and Egypt—to lessen reliance on the US dollar in world commerce.
Trump has insisted on a promise from these nations to give up any intention to establish a new BRICS currency or back other currencies that may compromise the dollar. Ignoring his warnings, he said, would lead to a 100% tariff on their US exports and loss of access to the rich American market.
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…
— Donald J. Trump (@realDonaldTrump) November 30, 2024
BRICS Challenges Highlight Tensions in Global Trade Policy
The warnings made by the president-elect draw attention to his aggressive trade policy approach, which reflects the same positions he adopted in the government.
Analysts interpret Trump’s recent comments as a direct response to the outcomes of the most recent BRICS conference, where leaders, including Russian President Vladimir Putin, criticized the US for its dollar weaponizing practices.
This meeting also strengthened BRICS’ desire to find alternatives for the dollar, a step that reflects mounting dissatisfaction with the dollar’s predominate influence in the world financial system.
Especially, Trump’s emphasis on tariffs as a means of preserving the dominance of the dollar highlights his overall economic approach. Traditionally, Trump has used tariffs to solve alleged economic disparities and pressure trade partners.
Economists caution, meanwhile, that if carried out, such policies might throw off world supply networks and raise American consumers’ prices. Moreover, these acts can aggravate geopolitical conflicts since several BRICS countries aim to establish themselves as leaders in a multipolar world economy.
The BRICS’ dedollarizing initiatives are starting to take hold in the meantime. The bloc has aggressively investigated alternatives like a gold-backed currency and trading local currencies. These projects seek to lessen the impact of the US dollar in trade as well as in foreign finance.
The development of an alternative currency by BRICS might, according to analysts, compromise the efficacy of US sanctions, which mostly depend on the centrality of the dollar.
Beside that, CNF previously reported that in search of an alternative for the USD, the BRICS alliance is considering using the gold market of the United Arab Emirates. Moreover, the way BRICS approach their main objective of lowering dollar reliance now depends on the part that Bitcoin and digital assets play.
