Trump threatens BRICS with 100% tariffs if USD replaced as reserve

“The idea that the BRICS countries are trying to move away from the dollar while we stand by and watch is OVER,” he wrote in a social media post yesterday.

BRICS members are Brazil, Russia, India, China and South Africa, the original five members, and Egypt, Ethiopia, Iran and the United Arab Emirates.

“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 US dollar, or they will face 100 per cent tariffs and should expect to say goodbye to selling into the wonderful US economy. They can go find another ‘sucker!’ There is no chance that the BRICS will replace the US dollar in international trade, and any country that tries should wave goodbye to America,” Trump posted.

Leaders in Brazil and Russia have suggested creating a BRICS currency to reduce the US dollar's dominance in global trade, but internal disagreement has slowed progress on that front. The US dollar accounts for over 90 per cent of global transactions.

At the BRICS summit in October this year, Russian President Vladimir Putin had warned that the “dollar is being used as a weapon”. But Prime Minister Narendra Modi had cautioned that the grouping should not acquire the image of one that is trying to replace global institutions.

But several nations have been looking at other mechanisms after the United States threw Iran and Russia out of the Society for Worldwide Interbank Financial Telecommunication (SWIFT)—the base for international transactions.

The Reserve Bank of India allowed invoicing and payments for global trade in rupees in 2022 after sanctions were imposed on Russia as the Ukraine war started.

India’s external affairs minister S Jaishankar said this October that while India is pursuing its trade interests, avoiding the use of the US dollar is not part of economic policy.

Fibre2Fashion News Desk (DS)