Following plans by BRICS alliance, consisting of Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran and the United Arab Emirates to float a new currency, The United States President-elect, Donald Trump, has threatened to impose 100% tariffs against the nations if they undermine the U.S. dollar.
Reports had it that members of the BRICS power bloc are proposing a new currency other than the U.S. dollar that was regarded the most-used currency in global business and has survived past challenges..
However, members of the alliance and other developing nations say they are fed up with America’s dominance of the global financial system.
Turkey, Azerbaijan and Malaysia have applied to become members of the alliance, and several other countries including Nigeria, recently joined the power bloc, while many others have expressed interest in joining.
However, members of the alliance and other developing nations say they are fed up with America’s dominance of the global financial system.
Trump, in a Truth Social post, said, “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 will face 100% Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy.”
This was one of the topical issues at a summit of BRICS nations in October with Russian President Vladimir Putin accusing the U.S. of “weaponizing” the dollar and describing it as a “big mistake.”
“It’s not us who refuse to use the dollar,” Putin said at the time. “But if they don’t let us work, what can we do? We are forced to search for alternatives.”
Russia has specifically pushed for the creation of a new payment system that would offer an alternative to the global bank messaging network, SWIFT, and allow Moscow to dodge Western sanctions and trade with partners.
Trump said there is “no chance” BRICS will replace the U.S. dollar in global trade and any country that tries to make that happen “should wave goodbye to America.”
Source – Tribune