U.S. President Donald Trump has threatened the BRICS group of emerging economies with 100% tariffs if they move away from the U.S. dollar as an international payment currency.
“The idea that BRICS countries are trying to move away from the dollar, while we stand by and watch, is over,” Trump said on his social media platform, Truth Social.
“We will demand a commitment from these seemingly hostile countries that they will neither create a new BRICS currency nor support any other currency to replace the mighty U.S. dollar, or they will face 100% tariffs,” Trump continued.
The acronym BRICS comes from the first letters of the founding member countries: Brazil, Russia, India, China, and South Africa.
In early 2024, Iran, Ethiopia, Egypt, and the United Arab Emirates joined BRICS, and Indonesia became a member in early January.
The group aims to act as a counterbalance to the G7.
Russian President Vladimir Putin has consistently criticized the dominance of the U.S. currency and declared his intention to create an independent payment and clearing system within the alliance.
The U.S. dollar has so far been the most important currency in global payment transactions.
By introducing another non-Western currency, Moscow hopes to be less affected by the sanctions imposed on Russia by the West due to its war in Ukraine.
Tariffs are additional charges on imported goods and are paid when the goods enter the country.
Trump imposed a series of tariffs on imported goods during his first term in office from 2017 to 2021.
Economists speculate that widespread tariffs would lead to higher prices in the U.S.
