What's happened
On December 2, 2024, Trump threatened to impose 100% tariffs on BRICS nations if they attempt to undermine the US dollar's status as the global reserve currency. This comes amid ongoing discussions about de-dollarization among countries like China and Russia, who are exploring alternatives to the dollar in international trade.
Why it matters
What the papers say
According to the South China Morning Post, Trump's recent threats to impose tariffs on BRICS nations are a reaction to their discussions about moving away from the dollar. The publication notes that while there is a sentiment among BRICS countries to reduce dollar reliance, the idea of a common currency is largely seen as unrealistic. Business Insider UK highlights the trend of de-dollarization, noting that countries like China and Russia are leading efforts to lessen dependence on the dollar, but analysts remain skeptical about the yuan's ability to replace it. Meanwhile, Bloomberg reports that South Africa's government has clarified that BRICS discussions focus on using national currencies for trade rather than creating a new currency, emphasizing the complexity of the situation.
How we got here
The US dollar has been the dominant global reserve currency since the Bretton Woods Agreement post-World War II. Recent geopolitical tensions, particularly following Russia's invasion of Ukraine, have prompted countries to consider reducing their reliance on the dollar, leading to discussions of a potential BRICS currency.
More on these topics
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Donald John Trump is an American politician, media personality, and businessman who served as the 45th president of the United States from 2017 to 2021.
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BRICS is the acronym coined to associate five major emerging economies: Brazil, Russia, India, China, and South Africa. The BRICS members are known for their significant influence on regional affairs.
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China, officially the People's Republic of China, is a country in East Asia. It is the world's most populous country, with a population of around 1.4 billion in 2019.
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Russia, or the Russian Federation, is a transcontinental country located in Eastern Europe and Northern Asia. Covering an area of 17,125,200 square kilometres, it is the largest country in the world by area, spanning more than one-eighth of the Earth's in
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Ukraine is a country in Eastern Europe. It is the second-largest European country after Russia, which borders it to the east and northeast.
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Vladimir Vladimirovich Putin is a Russian politician and former intelligence officer who has served as President of Russia since 2012, previously holding the position from 1999 until 2008.