Donald Trump is once again threatening BRICS countries with 100% import duties if they refuse to use the dollar in settlements, writes Associated Press. The US president's threat was directed at the countries of the so-called BRICS alliance, which includes Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates.
Despite the US dollar being the most used currency in global business and having survived past challenges to its dominance, members of the alliance and other developing countries say they are tired of America's dominance in the global financial system.
Trump published the threat on his social network Truth, promising maximum tariffs on products from BRICS countries.
According to the IMF, the dollar accounts for about 58% of global currency reserves, and major commodities like oil are still mostly bought and sold in dollars. However, the dollar's dominance is under threat due to the growing GDP share of BRICS countries and the alliance's intention to trade in non-dollar currencies—a process known as de-dollarization.
At the BRICS summit in October, Vladimir Putin stated that the alliance is forced to «seek alternatives». Russia insists on creating a new payment system that would be an alternative to the global banking messaging network SWIFT and would allow Moscow to evade Western sanctions and trade with partners.
Trump stated that BRICS countries have «no chance» to replace the US dollar in global trade, and any country that tries to do so «should wave goodbye to America».
Trump's latest tariff threat came after he threatened to impose 25% tariffs on everything imported from Mexico and Canada, and an additional 10% tax on goods from China, to force these countries to do more to stop the flow of illegal immigration and drugs into the US.