Trump threatens 100% tariff on BRICS countries if they pursue creating new currency

(CNN) — President-elect Donald Trump said he would require countries that are part of BRICS — a China- and Russia-backed group of emerging economies — to commit to not creating new currency or face 100% tariffs during his administration.

“The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER. 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 U.S. Dollar or, they will face 100% Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy,” Trump posted on Truth Social on Saturday afternoon.

BRICS had been made up of Brazil, Russia, India, China and South Africa since 2011. Earlier this year, Iran, the United Arab Emirates, Ethiopia and Egypt formally joined — the first expansion in over a decade. Thirty-four countries have submitted an expression of interest in joining the bloc of major emerging economies, South African Foreign Minister Naledi Pandor said in February.

The leader of one member country, Brazil’s Luiz Inácio Lula da Silva, in 2023 proposed creating a common currency in South America to reduce reliance on the US dollar.

Using BRICS currencies and banking networks outside the US dollar-denominated system could allow member countries such as Russia, China and Iran to circumnavigate Western sanctions. But the chances of a new currency are probably slim due to the alliance’s economic and geopolitical differences.

Speaking to reporters ahead of a summit of BRICS countries in Russia in October, President Vladimir Putin said the group was “not considering this issue.”

“Its time has not come yet. We need to be very careful and act gradually, without any rush,” Putin said when asked about any steps toward developing a common currency. He added the group was studying “the possibilities to make wider use of national currencies” and enhancing coordination between their central banks to support trade.

The expanding group is valuable to China as it looks to forge closer partnerships with key players to challenge the United States’ global leadership. And it’s also a boon to Russia, which has been shunned economically and diplomatically by the West following its 2022 invasion of Ukraine. This year, Russia assumed rotating chairmanship of the group.

During the BRICS summit in October, Putin and Chinese leader Xi Jinping sought to project the message that the West stands isolated in the world, while a “global majority” of countries support their bid to challenge American global leadership.

Trump’s latest economic threat comes days after he pledged massive hikes in tariffs on goods coming from Mexico, Canada and China starting on the first day of his administration. The move, Trump said, will be in retaliation for illegal immigration and “crime and drugs” coming across the border.

Since that announcement, Trump spoke with Mexican President Claudia Sheinbaum for the first time following the tariff announcement, but they have offered conflicting statements about the call. Canadian Prime Minister Justin Trudeau, meanwhile, traveled to Trump’s Mar-a-Lago estate in Florida to meet with the president. Trudeau said the Friday dinner with Trump “was an excellent conversation,” and the president-elect called it a “very productive meeting.”

CNN’s Simone McCarthy, Robert Ilich and Kit Maher contributed to this report.