The policy of threats, sanctions and increased tariffs, which the newly elected US President Donald Trump promised to adhere to in an attempt to preserve the hegemony of the dollar, poses a greater danger to the US currency than the likelihood that the BRICS countries will abandon it. This opinion is expressed in an article published by Bloomberg.
According to the publication's assessment, Trump's recent threats to introduce increased import duties if the BRICS countries abandon the dollar for their own single currency turned out to be “fighting windmills“, since the countries of the association did not plan to introduce a single currency in the near future. However, such a signal could prompt the BRICS to seek alternatives to the dollar for mutual payments and make the idea of a single currency more relevant against the backdrop of geopolitical divisions and trade wars.
As Bloomberg writes, citing sources in the Indian leadership, over the past few years, US sanctions have had an extremely negative impact on trade and energy cooperation between India and Venezuela, which was one of its largest partners. In this regard, the Indian authorities have an incentive to create payment mechanisms that are “not subject to US supervision“.
In addition, more and more “dual-use“ companies and products are used every year. They are subject to sanctions from Washington, and therefore businesses also feel the need to find alternatives to the dollar. "If Trump wants to preserve the dollar's global supremacy, he must recognize that its value depends not on American power and threats, but on American reliability. Excessive pressure poses a much greater threat to the US currency than anything the BRICS countries can do," the publication concludes.
In early December, Trump said he would impose 100% trade tariffs on goods from the BRICS countries if they create a new currency or abandon the dollar. According to him, any country that tries to find a substitute for the dollar for international trade will "say goodbye to America."