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April 4, 2025e-Paper
Updated – February 14, 2025 02:52 pm IST
U.S. President Donald Trump looks on as he stands in the Oval Office of the White House | Photo Credit: Reuters
Brazil's BRICS presidency this year will not advance a common currency for the group of major developing economies this year, four government officials said, but its agenda may pave the way for less reliance on the U.S. dollar in global trade. That agenda could draw the ire of U.S. President Donald Trump, who has repeatedly warned the BRICS group, founded by Brazil, Russia, India, China, not to challenge the dominance of "the mighty U.S. Dollar."
"There is no chance that BRICS will replace the U.S. Dollar in International Trade, or anywhere else, and any Country that tries should say hello to Tariffs, and goodbye to America!" Mr. Trump wrote on social media last month.
On Thursday, he repeated the threat of "100% tariffs" on BRICS nations "if they want to play games with the dollar."
Asked whether he wants to dismantle BRICS or be part of it, Mr. Trump responded, “I don’t care, but BRICS was put there for a bad purpose and most of those people don’t want it. They don’t even want to talk about it now. They’re afraid to talk about it because I told them if they want to play games with the dollar, then they’re going to be hit with a 100% tariff. The day they mention that they want to do it, they will come back and say, ‘We beg you not to do this’. BRICS is dead since I mentioned that.
#WATCH | "…BRICS is dead…" says US President Donald Trump
US President Donald Trump says, "BRICS was put there for a bad purpose… I told them if they want to play games with the Dollar, then they are going to be hit by a 100% tariff. The day they mention that they want to… pic.twitter.com/sgI88oktqD
“If BRICS wants to play games, those countries won’t trade with us. We won’t trade with them and if any trading gets through it’ll be a 100% tariff at least. When they hear that, what do you think they’re going to do? They’re going to say look what happened to BRICS. They didn’t want to talk about it. They don’t even want to admit that they were a member of BRICS. That’s what’s happened,” he added.
Brazilian officials, who requested anonymity to discuss plans, said the idea of a shared currency to replace the dollar, floated by President Luiz Inacio Lula da Silva and others at recent BRICS summits, has never entered technical discussions.
Three of the sources said Brazil is instead pushing reforms within BRICS to ease international payments in local currencies, opening the door to less dependence on the dollar for global trade, although they said that is not the main objective.
"It's not directed against anyone," said one source, who stressed the focus was on reducing friction for global trade.
The agenda includes studying technologies such as blockchain and linking payment systems to cut transaction costs, following standards set by multilateral bodies like the Bank for International Settlements (BIS), the three sources said.
"No one wants to create trouble, but BRICS countries also don't want to abandon the idea of exploring this possibility," said another source, adding that no member countries intend to eliminate their dollar reserves.
Even Lula has backed off the idea of a new currency for the bloc, while still defending last week the BRICS nations' "right to discuss establishing forms of trade that do not make us fully dependent on the dollar."
Last week, Brazil's finance ministry and central bank discussed their proposals for the BRICS presidency this year, including cross-border payment initiatives, sources said.
Neither institution responded to a request for comment.
BRICS representatives will meet in South Africa this month on the sidelines of the G20 meetings, where Brazil will present its plan for the BRICS summit in July, the sources added.
Published – February 14, 2025 11:36 am IST
currency values / diplomacy / trade policy / Brazil / India / USA / Donald Trump
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