President Donald Trump recently expressed skepticism about the idea of BRIC countries, a group of emerging economies backed by China and Russia, creating a new currency. He stated that the notion of undermining the dollar through this initiative is 'breaking up rapidly' and emphasized that such a scenario is unlikely to materialize.
During a meeting with Prime Minister Narendra Modi of India, a member of BRICS, Trump reiterated his stance and threatened to impose 100% tariffs on the nations involved. This is not the first time Trump has issued warnings of steep tariffs on BRIC countries, as he previously indicated in December that failure to comply with restrictions on creating a new currency could result in punitive measures.
BRICS, initially comprising Brazil, Russia, India, China, and South Africa since 2011, saw an expansion last year with the inclusion of Iran, the United Arab Emirates, Ethiopia, and Egypt. This marked the first enlargement in over a decade, with additional interest from 34 countries seeking to join the bloc of major emerging economies.
The potential use of BRICS currencies and banking networks outside the US dollar-dominated system could offer member countries like Russia, China, and Iran a means to bypass Western sanctions. However, the likelihood of a new currency coming to fruition remains uncertain due to the economic and geopolitical disparities within the alliance.
