Donald Trump threatens BRICS nations with 100 percent tariffs over dollar replacement plans
by ANI, St Petersburg News [12-1-2024 published].
(When we take a closer look at Trump's high tariff plans, especially the 100% one, they could hurt the US much more than the BRICS nations. Keep in mind that the many thousands of sanctions placed on Russia and those supporting Russia have hurt the US & Europe far more than Russia. In fact, the Russian GDP grew by 3.6% in 2023 and is expected to grow about 4% extra in 2024.
Also, BRICS now accounts for 37.4% of the global GDP, while the G7 accounts for only 29.3%. Putin stressed that this gap is widening and will keep widening.
It is very important to realized that the US via the SWIFT system weaponized the $dollar as a reserve currency. All of the BRICS nations have taken notice and are looking for alternatives. Many are now trading with their national currencies, bypassing the $dollar. Already 90% of the trade between Russia & China is done with national currencies & without the $dollar. Putin even said that Russia wasn't against using the $dollar, but the US weaponized the $dollar, so they had to find other ways to continue trading with friendly partners.
Alexander Dugin pointed out that "sanctions were a blessing in disguise in that they reduced Russia’s dependence on the West, boosted its domestic production and developed its industrial sector.”
Before taking a closer look at 100% tariffs, let's consider what happens when a 20% tariff is placed on imported goods. IKEA is already talking about having to raise prices. Who actually pays this? To keep things simple, let's assume that the profit margin for the imported goods from a specific company is only 20%. Obviously, the company can't pay the 20% tariff and keep the price the same, since they wouldn't make any money. Therefore, if they still want to sell those goods inside the US, they will have to raise the price, which means that those products will cost more for US buyers. Although it looks like the foreign company is paying the tariff, in reality the buyers in the US are paying that tariff via increased prices for those goods.
Now let's take a look at Trump's proposed 100% tariff on products from BRICS countries who are no longer using the $dollar for trade. First, those products will no longer be sold in the US, because there is no profit. But a more serious problem rears its head. Many of the BRICS nations have now shifted their trade among themselves and with friendly nations. Although there could be some adjustments, those countries are NOT dependent on the US market. BUT the US is currently dependent on trade with many of these countries. Therefore, with a 100% tariff on these products, the US can't purchase needed products. To make matters worse, the US currently doesn't have the skills & manufacturing capacity for many of these products.
The real problem is that the US has become used to bossing other countries around, instead of finding ways to work cooperatively. Russia today is far different than the Soviet Union that collapsed in 1991. The BRICS nations want to be sovereign with their own cultures and ways of doing things. They are striving to cooperate and do business with each other where it is mutually beneficial and without external interference from the US. One of the goals of the US foreign policy has been to break up Russia into smaller countries that could be controlled by the US. Russia has made it clear that this is no longer possible and if the West actually paid attention to Russian history, they would understand why.
Consider the economies of the top BRICS nations: Russia, China, India, Iran. They work well together and are now strong enough that they can stand up to the bully tactics of the US, which they are tired of. Trump is about to find this out.
Instead of fighting BRICS & Russia & China, the US would do the entire world a big favor if they would understand what BRICS is all about and strive to fit in with BRICS. This would resolve a lot of the conflicts and improve the lives for everyone.
— RAD)
Washington DC [US], December 1 (ANI): US President-elect Donald Trump on Saturday threatened the BRICS nations, including India, with 100 per cent tariffs and called for a clear commitment from these countries to refrain from creating a new currency or supporting any other currency to replace the US dollar.
Taking to the social media platform Truth Social, Trump stated that the idea of BRICS nations trying to move away from the dollar while the US stood by and watched was "over." He further warned that any country attempting to replace the USD would also lose access to the US market, adding that such countries would need to find "another sucker" if they pursued such actions.
"The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER. 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 U.S. Dollar or, they will face 100 per cent Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy. They can go find another "sucker!" Trump said.
"There is no chance that the BRICS will replace the U.S. Dollar in International Trade, and any Country that tries should wave goodbye to America," he added.
Trump's statement came after Russian President Vladimir Putin proposed creating a new investment platform for BRICS countries during the BRICS summit in Kazan in October, as reported by Reuters. This development could signal a move toward reduced dependence on the US dollar.
"We propose to set up a new investment platform of BRICS," Putin said, addressing the plenary session of the BRICS Summit.
"We need to jointly promote the low-emission model of the economy. New BRICS global investment platform to provide financial resources for all countries of the Global South," the Russian President added, as quoted by Reuters.
As of now, BRICS has two financial platforms: the New Development Bank, headquartered in Shanghai, and the Contingent Reserve Arrangement.
The New Development Bank mobilises resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries to supplement existing efforts of multilateral and regional financial institutions for global growth and development.
The Contingency Reserve Arrangement is a short-term liquidity support for the BRICS members through currency swaps to help mitigate the balance of payment crisis in case such a situation arises and thus further strengthens financial stability.
The BRICS group consists of five core members--Brazil, Russia, India, China, and South Africa--and in 2024 welcomed Egypt, Iran, the UAE, Saudi Arabia, and Ethiopia as full members. (ANI)
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Spokesman Dmitry Peskov has warned that the US president-elect’s warning will only accelerate desire to abandon the dollar.
Kremlin spokesman Dmitry Peskov, has weighed in on US President-elect Donald Trump’s weekend threat to impose 100% tariffs on BRICS countries if they pursue the creation of a currency to replace the US dollar. Peskov stressed on Monday that American pressure will only accelerate a growing global trend toward national currencies in trade, diminishing the greenback’s role as a reserve currency.
Peskov’s remarks come after Trump’s statement over the weekend on Truth Social, in which he warned that countries attempting to abandon the dollar in favor of an alternative would face severe economic consequences. “The dollar is starting to lose its attractiveness as a reserve currency for many nations,” Peskov said, adding that the erosion of its dominance is a “process gaining strength.”
This shift, Peskov noted, is not limited to BRICS nations but is a broader movement worldwide. The use of national currencies in trade is becoming increasingly common, as more states seek alternatives to the dollar, particularly in light of Western sanctions and the weaponization of financial systems. BRICS previously comprised Brazil, Russia, India, China, and South Africa, and was expanded in January to include Egypt, Iran, Ethiopia, and the United Arab Emirates.
Russia has supported the development of the BRICS Bridge platform, designed to facilitate settlements in national currencies, including via digital channels. Foreign Minister Sergey Lavrov has emphasized that such initiatives aim to shield countries from the economic influence of the US and EU.
Peskov also referred to statements by Russian President Vladimir Putin during the BRICS summit in Kazan in October, where he pointed out that while Russia hasn’t “rejected” the dollar, it has had to find alternative financial systems to circumvent Western control over global financial infrastructure.
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