US Threatens 100% Tariffs on BRICS Countries Over Proposed New Currency

US President-elect Donald Trump has issued a warning to BRICS nations regarding their discussions of establishing a new currency.

Trump emphasizes that the United States would not stand idly by as these nations attempt to undermine the dominance of the US dollar in international trade. He calls for a clear commitment from BRICS countries to abandon any plans to create or support a currency that could challenge the dollar’s longstanding status. In a post on X, Trump outlines potential consequences for BRICS nations should they proceed with their currency initiatives. He threatens to impose 100% tariffs on products imported from these countries and warns that they could lose access to the U.S. economy.

“The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is over,” Trump says, asserting that any attempt to replace the US dollar in global trade would meet significant repercussions.

This warning comes amidst ongoing deliberations among BRICS nations, which include Brazil, Russia, India, China, and South Africa, about the potential development of a new trade currency. In a notable proposal made earlier in 2023, Brazilian President Luiz Inácio Lula da Silva suggested the creation of a common currency for South America to lessen reliance on the US dollar. Such a transition could provide BRICS countries a means to circumvent Western sanctions by conducting trade using their national currencies and banking systems outside the dollar-based framework.

“They can go find another “sucker!” There is no chance that the BRICS will replace the U.S. Dollar in International Trade, and any Country that tries should wave goodbye to America,” Trump says.

Leaders within the BRICS coalition have expressed a keen interest in increasing the use of their own currencies for trade, signalling a desire to reduce dependence on the US dollar. The ongoing discussions around a proposed currency for BRICS nations signal a transformative shift in the global financial landscape. This initiative is seen as a way for these nations to bolster their economic autonomy and compete against the prevailing dominance of the US dollar in international trade. Recent trends indicate a significant uptick in oil transactions conducted in currencies other than the US dollar.

This shift is largely attributed to geopolitical tensions, particularly the trade war between the United States and China, as well as the sanctions placed on both China and Russia by the US government. The introduction of a BRICS reserve currency may have profound implications for the US dollar, potentially leading to a decrease in its global demand, a situation often referred to as de-dollarization. Such a shift could reverberate through both the US and global economies. In the broader context of US economic policy, President Trump has actively promoted protectionist measures, including the imposition of tariffs on imported goods.

These actions are intended to strengthen the US dollar against other major currencies, which may inadvertently encourage BRICS nations to seek alternatives to the dollar for international transactions. Notably, while Russian President Vladimir Putin recently introduced a prototype BRICS banknote, he clarified that the objective is not to completely abandon the US dollar but to create systems that facilitate the use of local currencies in trade between BRICS countries and their partners. This approach aims to mitigate the risks associated with the dollar’s “weaponization” in international relations.