"Find another sucker": Trump Warns BRICS of Hefty Tariffs, But Who Stands to Lose the Most?
The president-elect of the US has urged BRICS to maintain the dominance of the dollar, threatening a 100% tariff in the event of non-compliance. Read Full Article at RT.com
TroibNews 
The US president-elect has called for global loyalty to the US dollar, warning of severe consequences for those considering alternative currencies.
US President-elect Donald Trump has signaled a strong stance against the BRICS nations, known for their efforts to challenge the dollar's supremacy in international trade. If this movement gains momentum, Trump has threatened to implement “100% tariffs,” effectively isolating these countries from the “wonderful US economy.” Which nations may bear the brunt of this threat? RTN examines the economic dependencies to identify the targets in this escalating situation.
The Threat
“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% Tariffs and should expect to say goodbye to selling into the wonderful US Economy,” Trump stated in a post on Saturday on Truth Social.
“They can go find another ‘sucker.’ 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,” he added.
This warning followed Trump’s recent promise to impose tariffs on Canada, Mexico, and China as soon as he takes office on January 20, 2025. China has already been a primary target of his rhetoric, with Trump previously threatening tariffs between 60% and 100% on imports from the nation. However, these tariffs would ultimately affect American companies and consumers who purchase goods from China, as they would bear the increased costs.
China was one of the founding members of BRICS, which now includes Brazil, Russia, India, South Africa, Egypt, UAE, Ethiopia, and Iran. Countries such as Türkiye, Azerbaijan, and Malaysia have expressed interest in joining the group, alongside others.
Some BRICS members are keen to lessen their dependency on the US dollar, which has served as the world’s reserve currency since World War II, dominating over 80% of international trade.
In October, Russian President Vladimir Putin highlighted the necessity of countering the US’s use of the dollar as a political tool. At the BRICS Summit, he showcased what seemed to be a prototype banknote for the bloc but clarified that their intention is not to entirely abandon the dollar-centric SWIFT system but to develop an alternative route.
“We are not refusing, not fighting the dollar, but if they don’t let us work with it, what can we do? We then have to look for other alternatives, which is happening,” Putin remarked.
Brazilian President Luiz Inacio Lula da Silva also questioned the rationale behind the global economy's reliance on the dollar, while a senior Russian official hinted at the active exploration of a new BRICS-backed currency, potentially reshaping international commerce.
Fresh from an electoral victory bolstered by promises of imposing strict tariffs on foreign imports, Trump intensified his tough approach by threatening to sanction the entire BRICS bloc with 100% tariffs should they pursue their currency ambitions. Which countries are poised to bear the highest risks?
The Risks for BRICS
**Iran**
- Exports to the US: Minimal, due to existing sanctions.
- Risk assessment: Low. Current sanctions hinder trade, making additional tariffs inconsequential.
**Ethiopia**
- Exports to the US: Limited, mainly agricultural products.
- Risk assessment: Low. The modest trade volume lessens the possible impact of tariffs.
**Russia**
- Exports to the US: Concentrated in mineral fuels and precious metals.
- Risk assessment: Low to moderate. Although the US represents a notable market, Russia's diversified export portfolio and current geopolitical tensions limit trade with the US, reducing the effects of potential tariffs.
**Egypt**
- Exports to the US: Predominantly textiles and agricultural goods.
- Risk assessment: Moderate. The US is an important market for Egyptian textiles, thus tariffs could adversely affect this sector.
**South Africa**
- Exports to the US: Key exports include vehicles and minerals.
- Risk assessment: Moderate to high. The automotive sector could encounter significant challenges with tariffs due to its substantial role in South Africa’s economy.
**United Arab Emirates**
- Exports to the US: Focus on petroleum, aluminum, and precious metals.
- Risk assessment: Moderate to high. Tariffs on key sectors like aluminum could disrupt trade balance.
**India**
- Exports to the US: Pharmaceuticals, textiles, and machinery among top exports.
- Risk assessment: High. The US is a crucial market for Indian goods, and tariffs could disturb various industries, especially IT services and textiles.
**Brazil**
- Exports to the US: Crude oil and aircraft are leading exports.
- Risk assessment: High. The country has significant reliance on the US market, particularly for high-value goods like aircraft, making it vulnerable to tariffs.
**China**
- Exports to the US: Includes electronics, machinery, and textiles.
- Risk assessment: Very high. As the top exporter to the US, China would face severe economic repercussions from a 100% tariff, impacting many sectors. Trump has already threatened China with tariffs, leading Beijing to ponder its options, regardless of any dollar alternative.
While BRICS nations contemplate challenging US economic supremacy, they must proceed with caution, given the formidable US trade position, particularly with Trump's assertive policies. The US remains a leading export destination for major BRICS players like China, India, and Brazil, all heavily reliant on US markets. Trump's aggressive trade tactics underline the significant pressure Washington can impose on individual member states.
The Risks for the US
If enacted, Trump’s tariffs would impact not only certain BRICS economies but also the US. Here’s a glimpse of potential outcomes:
**Higher Costs for US Consumers**
- **China**: As the leading exporter to the US, a 100% tariff on Chinese goods would spike prices significantly.
- **Impact**: Essential consumer goods would become more expensive, contributing to inflation and disproportionately affecting low- and middle-income families.
**Supply Chain Disruptions**
- **India and Brazil**: Key suppliers of pharmaceuticals, crude oil, and aircraft components.
- **Impact**: Tariffs could cause shortages or price hikes in critical sectors like healthcare and aviation, making it challenging for US manufacturers to swiftly replace imports.
**Retaliatory Tariffs**
- BRICS+ countries would likely retaliate with tariffs on US exports, including agricultural products, machinery, and technology.
- **Impact**: US farmers and manufacturers could face reduced access to international markets, diminishing competitiveness and potentially resulting in job losses.
**Geopolitical Consequences**
- **Economic Isolation**: Targeting BRICS+ may accelerate their efforts to eliminate reliance on the dollar, weakening its global influence.
- **Impact**: This shift could diminish the US’s position in international finance, reducing its ability to leverage economic power for geopolitical ends.
**Stock Market Volatility**
- A combination of inflation, supply chain issues, and a decline in international trade could lead to market instability.
- **Impact**: Investor pullback could ensue, resulting in stock price fluctuations and potentially stalling business investment.
The US industries most likely to weather the storm include:
**Electronics and Technology**
- **Main source**: China
- **Impact**: A significant portion of electronics is imported from China, and a tariff would dramatically raise costs, hindering domestic companies' ability to source affordable components, ultimately increasing consumer prices and stifling innovation.
**Pharmaceuticals**
- **Main source**: India
- **Impact**: India is a major supplier of generic drugs and active pharmaceutical ingredients. Tariffs would heighten healthcare costs, potentially leading to shortages and increased reliance on expensive alternatives.
**Automotive**
- **Main source**: South Africa and Brazil
- **Impact**: Tariffs would disrupt supply chains, raising the manufacturing expenses for vehicles and pushing higher prices to consumers.
**Aerospace**
- **Main source**: Brazil
- **Impact**: Aircraft components and parts from Brazil, particularly from Embraer, would be affected, raising costs for airlines and aerospace manufacturers.
**Agriculture and Food**
- **Main source**: BRICS countries
- **Impact**: Staple imports such as coffee, tea, fruits, and seafood would see price surges, making essentials costlier for US consumers and disrupting food supply networks.
While enforcing 100% tariffs may align with Trump’s ‘America First’ ideology and provide a short-term boost to certain domestic sectors, the long-term risks could outweigh the gains. Indications are that consumer prices would rise, supply chains would face upheaval, and retaliatory measures could hinder US economic growth, spur inflation, and erode the dollar’s standing.
The Prospects
Could BRICS counter the tariffs?
Yes, they could adopt several strategies. Strengthening intra-BRICS trade ties could lessen dependency on US markets. Exploring partnerships with non-aligned countries and utilizing local currencies for trade could further push the bloc toward establishing payment systems independent of the dollar. Nations most reliant on US imports might subsidize impacted sectors to maintain competitiveness during the transition to alternative markets. Additionally, BRICS members could amplify their global economic presence by portraying US tariffs as a threat to global trade stability.
**Is De-Dollarization Actually Possible?**
The movement towards decreasing reliance on the dollar in global trade is gaining traction. However, even if BRICS pursues this strategy, the path ahead is complex due to the dollar's entrenched trust, liquidity, and global use. Replacing or even diminishing its role requires new infrastructure and widespread consensus among global trading partners. Recent steps, such as increased local currency trading and discussions around a BRICS currency, indicate serious intent but suggest a slow journey ahead. For now, small steps like developing independent digital payment systems can be prioritized.
A mathematical study published in 2023 in ‘Applied Network Science’ suggests that BRICS members have a strong possibility of establishing dominance in international trade through a unified currency. Based on trade flows and excluding political factors, the study indicates that around 58% of countries would prefer a BRICS-backed currency over the US dollar or euro.
Could Trump truly enact tariffs?
The likelihood is moderate. Protectionist policies align with his campaign promises, and his past term revealed his willingness to employ tariffs to achieve political and economic ends, such as during the trade war with China. However, public backlash against potential price increases could serve as a deterrent. Allies in Europe and other regions may oppose the tariffs if they disrupt global stability. Notably, Trump has previously used threats as a geopolitical tool without carrying them out, suggesting he might adopt a similar approach again.
Sophie Wagner contributed to this report for TROIB News
US President-elect Donald Trump has signaled a strong stance against the BRICS nations, known for their efforts to challenge the dollar's supremacy in international trade. If this movement gains momentum, Trump has threatened to implement “100% tariffs,” effectively isolating these countries from the “wonderful US economy.” Which nations may bear the brunt of this threat? RTN examines the economic dependencies to identify the targets in this escalating situation.
The Threat
“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% Tariffs and should expect to say goodbye to selling into the wonderful US Economy,” Trump stated in a post on Saturday on Truth Social.
“They can go find another ‘sucker.’ 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,” he added.
This warning followed Trump’s recent promise to impose tariffs on Canada, Mexico, and China as soon as he takes office on January 20, 2025. China has already been a primary target of his rhetoric, with Trump previously threatening tariffs between 60% and 100% on imports from the nation. However, these tariffs would ultimately affect American companies and consumers who purchase goods from China, as they would bear the increased costs.
China was one of the founding members of BRICS, which now includes Brazil, Russia, India, South Africa, Egypt, UAE, Ethiopia, and Iran. Countries such as Türkiye, Azerbaijan, and Malaysia have expressed interest in joining the group, alongside others.
Some BRICS members are keen to lessen their dependency on the US dollar, which has served as the world’s reserve currency since World War II, dominating over 80% of international trade.
In October, Russian President Vladimir Putin highlighted the necessity of countering the US’s use of the dollar as a political tool. At the BRICS Summit, he showcased what seemed to be a prototype banknote for the bloc but clarified that their intention is not to entirely abandon the dollar-centric SWIFT system but to develop an alternative route.
“We are not refusing, not fighting the dollar, but if they don’t let us work with it, what can we do? We then have to look for other alternatives, which is happening,” Putin remarked.
Brazilian President Luiz Inacio Lula da Silva also questioned the rationale behind the global economy's reliance on the dollar, while a senior Russian official hinted at the active exploration of a new BRICS-backed currency, potentially reshaping international commerce.
Fresh from an electoral victory bolstered by promises of imposing strict tariffs on foreign imports, Trump intensified his tough approach by threatening to sanction the entire BRICS bloc with 100% tariffs should they pursue their currency ambitions. Which countries are poised to bear the highest risks?
The Risks for BRICS
**Iran**
- Exports to the US: Minimal, due to existing sanctions.
- Risk assessment: Low. Current sanctions hinder trade, making additional tariffs inconsequential.
**Ethiopia**
- Exports to the US: Limited, mainly agricultural products.
- Risk assessment: Low. The modest trade volume lessens the possible impact of tariffs.
**Russia**
- Exports to the US: Concentrated in mineral fuels and precious metals.
- Risk assessment: Low to moderate. Although the US represents a notable market, Russia's diversified export portfolio and current geopolitical tensions limit trade with the US, reducing the effects of potential tariffs.
**Egypt**
- Exports to the US: Predominantly textiles and agricultural goods.
- Risk assessment: Moderate. The US is an important market for Egyptian textiles, thus tariffs could adversely affect this sector.
**South Africa**
- Exports to the US: Key exports include vehicles and minerals.
- Risk assessment: Moderate to high. The automotive sector could encounter significant challenges with tariffs due to its substantial role in South Africa’s economy.
**United Arab Emirates**
- Exports to the US: Focus on petroleum, aluminum, and precious metals.
- Risk assessment: Moderate to high. Tariffs on key sectors like aluminum could disrupt trade balance.
**India**
- Exports to the US: Pharmaceuticals, textiles, and machinery among top exports.
- Risk assessment: High. The US is a crucial market for Indian goods, and tariffs could disturb various industries, especially IT services and textiles.
**Brazil**
- Exports to the US: Crude oil and aircraft are leading exports.
- Risk assessment: High. The country has significant reliance on the US market, particularly for high-value goods like aircraft, making it vulnerable to tariffs.
**China**
- Exports to the US: Includes electronics, machinery, and textiles.
- Risk assessment: Very high. As the top exporter to the US, China would face severe economic repercussions from a 100% tariff, impacting many sectors. Trump has already threatened China with tariffs, leading Beijing to ponder its options, regardless of any dollar alternative.
While BRICS nations contemplate challenging US economic supremacy, they must proceed with caution, given the formidable US trade position, particularly with Trump's assertive policies. The US remains a leading export destination for major BRICS players like China, India, and Brazil, all heavily reliant on US markets. Trump's aggressive trade tactics underline the significant pressure Washington can impose on individual member states.
The Risks for the US
If enacted, Trump’s tariffs would impact not only certain BRICS economies but also the US. Here’s a glimpse of potential outcomes:
**Higher Costs for US Consumers**
- **China**: As the leading exporter to the US, a 100% tariff on Chinese goods would spike prices significantly.
- **Impact**: Essential consumer goods would become more expensive, contributing to inflation and disproportionately affecting low- and middle-income families.
**Supply Chain Disruptions**
- **India and Brazil**: Key suppliers of pharmaceuticals, crude oil, and aircraft components.
- **Impact**: Tariffs could cause shortages or price hikes in critical sectors like healthcare and aviation, making it challenging for US manufacturers to swiftly replace imports.
**Retaliatory Tariffs**
- BRICS+ countries would likely retaliate with tariffs on US exports, including agricultural products, machinery, and technology.
- **Impact**: US farmers and manufacturers could face reduced access to international markets, diminishing competitiveness and potentially resulting in job losses.
**Geopolitical Consequences**
- **Economic Isolation**: Targeting BRICS+ may accelerate their efforts to eliminate reliance on the dollar, weakening its global influence.
- **Impact**: This shift could diminish the US’s position in international finance, reducing its ability to leverage economic power for geopolitical ends.
**Stock Market Volatility**
- A combination of inflation, supply chain issues, and a decline in international trade could lead to market instability.
- **Impact**: Investor pullback could ensue, resulting in stock price fluctuations and potentially stalling business investment.
The US industries most likely to weather the storm include:
**Electronics and Technology**
- **Main source**: China
- **Impact**: A significant portion of electronics is imported from China, and a tariff would dramatically raise costs, hindering domestic companies' ability to source affordable components, ultimately increasing consumer prices and stifling innovation.
**Pharmaceuticals**
- **Main source**: India
- **Impact**: India is a major supplier of generic drugs and active pharmaceutical ingredients. Tariffs would heighten healthcare costs, potentially leading to shortages and increased reliance on expensive alternatives.
**Automotive**
- **Main source**: South Africa and Brazil
- **Impact**: Tariffs would disrupt supply chains, raising the manufacturing expenses for vehicles and pushing higher prices to consumers.
**Aerospace**
- **Main source**: Brazil
- **Impact**: Aircraft components and parts from Brazil, particularly from Embraer, would be affected, raising costs for airlines and aerospace manufacturers.
**Agriculture and Food**
- **Main source**: BRICS countries
- **Impact**: Staple imports such as coffee, tea, fruits, and seafood would see price surges, making essentials costlier for US consumers and disrupting food supply networks.
While enforcing 100% tariffs may align with Trump’s ‘America First’ ideology and provide a short-term boost to certain domestic sectors, the long-term risks could outweigh the gains. Indications are that consumer prices would rise, supply chains would face upheaval, and retaliatory measures could hinder US economic growth, spur inflation, and erode the dollar’s standing.
The Prospects
Could BRICS counter the tariffs?
Yes, they could adopt several strategies. Strengthening intra-BRICS trade ties could lessen dependency on US markets. Exploring partnerships with non-aligned countries and utilizing local currencies for trade could further push the bloc toward establishing payment systems independent of the dollar. Nations most reliant on US imports might subsidize impacted sectors to maintain competitiveness during the transition to alternative markets. Additionally, BRICS members could amplify their global economic presence by portraying US tariffs as a threat to global trade stability.
**Is De-Dollarization Actually Possible?**
The movement towards decreasing reliance on the dollar in global trade is gaining traction. However, even if BRICS pursues this strategy, the path ahead is complex due to the dollar's entrenched trust, liquidity, and global use. Replacing or even diminishing its role requires new infrastructure and widespread consensus among global trading partners. Recent steps, such as increased local currency trading and discussions around a BRICS currency, indicate serious intent but suggest a slow journey ahead. For now, small steps like developing independent digital payment systems can be prioritized.
A mathematical study published in 2023 in ‘Applied Network Science’ suggests that BRICS members have a strong possibility of establishing dominance in international trade through a unified currency. Based on trade flows and excluding political factors, the study indicates that around 58% of countries would prefer a BRICS-backed currency over the US dollar or euro.
Could Trump truly enact tariffs?
The likelihood is moderate. Protectionist policies align with his campaign promises, and his past term revealed his willingness to employ tariffs to achieve political and economic ends, such as during the trade war with China. However, public backlash against potential price increases could serve as a deterrent. Allies in Europe and other regions may oppose the tariffs if they disrupt global stability. Notably, Trump has previously used threats as a geopolitical tool without carrying them out, suggesting he might adopt a similar approach again.
Sophie Wagner contributed to this report for TROIB News
