Trump threatens BRIC nations with 100% tariff if they 'move away' from US dollar

WASHINGTON − President-elect Donald Trump threatened the BRIC group of emerging-market nations on Saturday, warning that he would impose 100% tariffs if they make any moves to undermine the U.S. dollar.

Trump's comment, made on his Truth Social platform, is in apparent response to efforts to challenge or replace the U.S. dollar as the primary global reserve currency.

The BRIC alliance, originally comprised of Brazil, Russia, India, and China, now includes five other countries : South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates.

On Saturday, Trump wrote , "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 said. "They can go find another 'sucker!' There is no chance that the BRICS will replace the U.S. Dollar in International Trade, and any Country that tries should wave goodbye to America."

At a summit of BRIC nations in October,  Russian President Vladimir Putin accused the U.S. of “weaponizing” the dollar  and described it as a “big mistake,” the Associated Press reported.

Collectively, the nine-country BRIC group accounts for 45% of the world's population. Turkey, Azerbaijan and Malaysia also have applied to become members.

Tariffs are essentially a tax or fee on all imported goods. Because  tariffs are paid by importers , not by the originating countries, the additional costs typically are passed along to consumers. Trump's repeated threats to impose large, across-the-board tariffs  have prompted anxiety , not just among American consumers, but also some of the biggest U.S. trading partners.

Do tariffs help or harm the economy?

Trump has turned to tariffs as a way to boost the U.S. economy, saying they would generate trillions of dollars for the government. He has proposed a  10% to 20% tariff on all $3 trillion per year of imported products , with a 60% rate for products from China.

Some experts say that such tariffs are projected to increase inflation and lower growth in the United States. One of the nation's largest investment banks,  Goldman Sachs, warned  in September that Trump's plan could boost inflation in 2025 by as much as 1.2%.

In 2018, Trump imposed tariffs on  $380 billion  worth of imported products. He  claimed  the foreign countries  pay the tariff , but a paper from the  National Bureau of Economic Research found  "the full incidence of the tariff falls on domestic consumers." A  study by the New York Fed  found Trump's first-term tariffs cost the average household $831 per year.

Last Monday, Trump also proposed enacting tariffs against three of Washington's biggest trading partners if they don't work with the U.S. to fight the fentanyl drug overdose epidemic and illegal immigration into the United States. He pledged to hit Mexico and Canada with a 25% tariff, and China with a 10% tariff.

More: Tax cuts, tariffs and deportation: How economists say Donald Trump would increase inflation

Trump spoke with Mexican President Claudia Sheinbaum about those tariffs on Wednesday. And Canadian Prime Minister Justin Trudeau flew to Mar-a-Lago on Friday evening to meet with Trump to discuss the tariff threats.

All three leaders described the talks as productive without providing details. Trudeau  returned home Saturday  without assurances that Trump will back away from threatened tariffs on all products from the major American trading partner, the AP reported.

This article originally appeared on USA TODAY: Trump vows 100% tariff on BRIC nations if they ditch US dollar support