US President-elect Donald Trump has threatened to impose 100% tariffs on a bloc of nine nations if they were to create a rival currency to the US dollar.
This latest message from Trump, who will take office next year on 20 January, was aimed at the Brics, a bloc of mostly emerging economies.
Leading politicians in Brazil and Russia have suggested creating a Brics currency to reduce the US dollar’s dominance in global trade.
But some Trump allies have suggested his recent announcements have been negotiation tactics, meant as more of an opening bid than a promise.
So a car imported to the US with a value of $50,000 subject to a 25% tariff, would face a $12,500 charge.
Donald Trump, the US president-elect, has threatened to impose 100% tariffs on a group of nine countries if they develop a currency that is competitive with the US dollar.
On Saturday, Trump posted on social media, saying, “The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER.”.
Along with Brazil, India, South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates, the Brics alliance includes two of the world’s most powerful nations: China and Russia.
Trump promised enacting broad tariffs during the US election campaign. In recent days, he has intensified his threats of steep levies.
The Brics, a group of primarily emerging economies, were the target of Trump’s most recent message. Trump will take office on January 20 of next year.
Leading Russian and Brazilian politicians have proposed a Brics currency to lessen the US dollar’s hegemony in international trade. However, any progress has been slowed by internal conflict.
Trump posted on his social media platform Truth Social, saying, “We require a commitment from these countries that they will create a new Brics currency or back any other currency to replace the mighty US dollar or they will face 100 percent tariffs and should expect to say goodbye to selling into the wonderful US economy.”.
He remarked, “They can go find another sucker,”.
Trump’s recent announcements, however, have been interpreted by some of his supporters as negotiation ploys, more of an opening offer than a commitment.
The “importance of leverage” was the Republican senator Ted Cruz’s response when asked about the president-elect’s proposed use of tariffs.
On CBS News’ Face the Nation on Sunday, the Texan stated, “You look at the threat of tariffs against Mexico and Canada, immediately has produced action.”.
In an apparent attempt to avert a possible 25 percent tariff on Canadian goods traveling south, Canadian Prime Minister Justin Trudeau paid an unexpected visit to Trump’s Mar-a-Lago estate in Florida on Friday.
Trump’s choice for Treasury Secretary, Scott Bessent, has previously implied that the president-elect’s threats of significant tariff increases were a component of his negotiating approach.
In an interview with the Financial Times prior to Trump’s nomination, Bessent stated, “I think he’s a free trader at the end of the day.”.
To de-escalate, it must be escalated. “.”.
A domestic tax proportionate to the import value that is applied to goods as they enter the nation is called a tariff. Thus, a $50,000 car that is imported into the US and is subject to a 25% tariff would cost $12,500.
A key component of Trump’s economic strategy is tariffs, which he views as a means of boosting the US economy, preserving jobs, and increasing tax receipts.
These taxes are “not going to be a cost to you, it’s a cost to another country,” as he has stated before.
Economists nearly all agree that this is deceptive.
Instead of the foreign company that exports the goods, the domestic company that imports them pays the charge in person.
Therefore, it can be considered a simple tax that domestic US companies pay to the US government.
During his first term, Trump imposed a number of tariffs, many of which his successor, President Joe Biden, has maintained. According to economic research, US consumers ultimately bore the majority of the financial burden.
