Donald Trump, the U.S. President-elect, announced his intention to impose 100% tariffs on countries within the BRICS group unless they pledge not to create a new currency. The BRICS nations, a bloc of emerging economies including Brazil, Russia, India, China, and South Africa, have been exploring ways to reduce reliance on the U.S. dollar.
Trump made the announcement on Truth Social, emphasizing the need to preserve the dollar’s dominance and warning BRICS countries against any attempts to develop or support alternative currencies.
The BRICS bloc, which expanded earlier this year to include Iran, the UAE, Ethiopia, and Egypt, has been attracting interest from several other nations. Brazil’s president, Luiz Inácio Lula da Silva, suggested a common currency for South America to minimize dependence on the dollar, highlighting the bloc’s growing ambition to create alternative financial systems.
This trend has alarmed Western policymakers, as BRICS currencies and banking networks could provide avenues for nations like Russia, China, and Iran to bypass sanctions.
Trump Threatens BRICS Nations with 100% Tariffs to Protect Dollar’s Global Dominance
Despite the rhetoric, the likelihood of BRICS launching a new currency soon appears low. Russian President Vladimir Putin stated during a BRICS summit in October that the group was not yet ready to pursue a common currency, emphasizing the need for caution and gradual progress. Instead, BRICS countries have focused on increasing the use of their national currencies and enhancing central bank coordination to facilitate trade within the bloc.
BRICS’ expansion and financial ambitions reflect China’s and Russia’s desire to challenge U.S. global leadership. For China, the group offers an avenue to build stronger partnerships in its bid for global influence. For Russia, BRICS has provided an economic and diplomatic lifeline amid its isolation by the West following its invasion of Ukraine. At the October summit, Putin and Chinese leader Xi Jinping presented BRICS as a “global majority” opposing Western dominance, underscoring the bloc’s strategic importance.
Trump’s tariff threats are part of a broader strategy of economic nationalism, as evidenced by his recent pledge to hike tariffs on goods from Mexico, Canada, and China. While this approach aims to address concerns like immigration and drug trafficking, it risks straining relations with key trading partners. Trump’s interactions with Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau following his tariff announcement have underscored the tensions and complexities of his trade policies.
