Trump Threatens BRICS Nations With 100% Tariffs Over Dollar Challenge
US President Donald Trump has threatened to impose 100% tariffs on the BRICS bloc if member nations take any action to undermine the US dollar's dominance in global finance. The threat comes as the expanded BRICS group, which includes major emerging economies, convenes in Brazil. Last year's summit in Russia explored alternatives to US-dominated payment systems, a move seen as a way to bypass Western sanctions. The threat heightens economic tensions and influences the cautious agenda at the current summit.
Unpacked:
BRICS nations have discussed creating a new currency and developing cross-border payment systems, such as a blockchain-based platform called Project mBridge. They have also agreed in principle to use a settlement currency, partly backed by gold and local BRICS currencies, to facilitate trade outside the US dollar system.
BRICS represents about 27% of global GDP and includes over half of the world's population. Some projections suggest BRICS could comprise the majority of global GDP by 2050, especially as China’s economy continues to grow rapidly.
While a BRICS currency could facilitate trade within the bloc and reduce reliance on the US dollar among its members, the dollar remains deeply entrenched in global finance. Full replacement is unlikely soon, but a BRICS currency could still weaken the dollar’s dominance over time.
US tariffs on BRICS countries could escalate trade tensions, disrupt supply chains, and increase costs for consumers and businesses worldwide. It could also push BRICS nations to accelerate efforts to develop alternative payment systems and currencies, further challenging US economic influence.