Hardly a day goes by without the US president-elect threatening a state with his weapon of choice, the tariff club. Now this is targeting countries in the BRICS alliance and their attempts to break the dominance of the US dollar.
“We demand a commitment that they will neither create a new BRICS currency nor support another currency to replace the powerful US dollar,” Trump wrote on his online platform Truth Social on Saturday. Otherwise, he will impose “100 percent tariffs” on goods from these countries.
The abbreviation BRICS stands for the first letters of the first five members: Brazil, Russia, India, China and South Africa. Earlier this year, Iran, Egypt, Ethiopia and the United Arab Emirates joined. It is a group of emerging industrial countries. Other countries are also pursuing membership.
At the end of October, the heads of state and government of the alliance met for a summit conference in the Russian city of Kazan. Kremlin chief Vladimir Putin promised participants to strengthen cooperation, especially in the financial sector.
Kremlin spokesman Dmitry Peskov denied that Moscow was trying to use the BRICS to challenge the dominance of the US dollar in global markets. However, Putin had previously criticized the dominance of the US currency several times and announced that he wanted to set up an independent payment and settlement system within the BRICS.
The American currency is by far the most important in global payment transactions. By introducing a different, non-Western currency, Moscow hopes to be less affected by the sanctions imposed by the West in response to the war in Ukraine.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
