Trump warned that countries that move away from the dollar will be hit with 100% tariffs and be excluded from the US economy.
US President-elect Donald Trump sent a warning to Brics countries about creating a new currency.
“The idea that the Brics countries are trying to move away from the dollar while we stand by and watch is OVER,” Trump tweeted on Saturday night.
Brics discussions on replacing US dollar
The Brics grouping includes South Africa, Brazil, Russia, India, China and others.
At the Brics summit in Johannesburg in August 2023, the Brics Business Forum discussed implementing a single currency and common payment system for international trade. It was on the agenda again at the summit held in Kazan, Russia, in November this year.
This included replacing the dollar as the primary currency for international financial transactions.
ALSO READ: Single Brics currency top of agenda as summit starts
Trump threatens Brics nations
Trump, who will return to the White House in January, warned that countries that move away from the dollar will be hit with 100% tariffs and be excluded from the US economy.
“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 US dollar or, they will face 100% tariffs, and should expect to say goodbye to selling into the wonderful US economy,” his tweet continued.
“They can go find another sucker!
“There is no chance that the Brics will replace the US dollar in international trade, and any country that tries should wave goodbye to America.”
De-dollarisation unlikely
Speaking to The Citizen after the Brics summit in Johannesburg, international relations expert Dr Sithembile Mbete of the University of Pretoria said the de-dollarisation proposed by Brics countries is unlikely.
She said this wasn’t a viable option yet because international trade is dominated by the West-controlled Swift (Society for Worldwide Interbank Financial Telecommunications) banking system.
Mbete added Brics countries could use local currencies when trading with each other but would need to continue using the dollar when trading with the West.
ALSO READ: Is a Brics currency possible? Experts say it’s not an option
Prof. William Gumede, author of South Africa in BRICS, also said he doesn’t see any benefit for the rand if a Brics currency is created.
“So far, our biggest trading partners are in the West and any change will knock our currency harder than others. Our currency will suffer the most,” he said.
