Donald Trump, the U.S. President-elect, warned on the 30th (local time) that he would impose a 100% tariff on BRICS countries seeking to find a reserve currency other than the dollar.
In a message posted on social media platform Truth Social, Trump stated, “The idea that BRICS countries are moving away from the dollar is now over.” He asserted that these countries must promise not to create a new BRICS currency or support any other currency to replace the strong U.S. dollar, or else they would face a 100% tariff and have to say goodbye to the prosperous American economy.
He further mentioned that BRICS countries have no chance of replacing the U.S. dollar in international trade, and any country attempting this would have to say their goodbyes to the U.S.
Throughout this year’s election period, Trump pledged to maintain the U.S. dollar as the world’s reserve currency and warned that if he takes office, he would impose a 100% tariff on China and other countries challenging the dollar’s dominance.
The BRICS countries, which include Brazil, Russia, India, China, and South Africa, are discussing ways to move away from the dollar, such as increasing the use of regional currencies and establishing a central bank digital currency (CBDC) payment system among BRICS nations.
China, in particular, is challenging the dollar’s dominance by internationalizing the yuan and exploring digital reserve currency concepts, while Russia, facing Western sanctions after its 2022 invasion of Ukraine, is also actively moving away from the dollar.
The U.S. responded to Russia’s invasion by freezing the Russian central bank’s dollar-denominated foreign assets and excluding major Russian banks from the SWIFT payment network, actions criticized by China as a weaponization of the dollar.