Donald Trump warns of 100% tariff on BRICS nations

US President-elect Donald Trump on Saturday threatened to impose 100 per cent tariffs on BRICS nations if they create a currency rivaling the American dollar. "The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER," Trump, who is set to take office on January 20, wrote on microblogging site X (formerly Twitter). Trump also called for a clear commitment from these countries to refrain from creating a new currency or supporting any other potential substitute to the dollar.

The BRICS bloc, which is formed mostly of emerging markets, comprises Brazil, Russia, India, China, South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates (UAE).

Widespread tariffs were part of Trump's official campaign for the 2024 US presidential election. Trump also asserted that the US dollar faced threats to its future as the world's premier trading currency, claiming that President Joe Biden was ignoring it. 

Trump's remarks came against the backdrop of politicians in Brazil and Russia suggesting the creation of a BRICS currency to counter the US dollar's dominance in international trade.

"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 per cent Tariffs, and should expect to say goodbye to selling into the wonderful US Economy," wrote Trump.

"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," added Trump, threatening to close the American market to BRICS nations including India. 

India is the second-largest economy in BRICS.

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…

— Donald J. Trump (@realDonaldTrump) November 30, 2024

Meanwhile, External Affairs Minister S Jaishankar has ruled out the idea of a common BRICS currency.

What is BRICS?

The BRICS group consists of five core members: Brazil, Russia, India, China and South Africa. Additionally, in 2024, Egypt, Iran, the UAE, Saudi Arabia, and Ethiopia were welcomed as full members of the bloc. 

Several other countries have applied to join BRICS, which is making headway as an economy-focused organisation of the Global South.

Currently, BRICS has two financial platforms: the New Development Bank and the Contingent Reserve Arrangement.

While the New Development Bank mobilises resources for infrastructure and sustainable development projects in BRICS, other emerging economies and developing countries, the Contingency Reserve Arrangement provides short-term liquidity support to the BRICS members through currency swaps.

With inputs from agencies