New Delhi [India], December 1 : Chief Economist at Infomerics, Manoranjan Sharma, reacting to American President-elect Donald Trump's warning to BRICS countries regarding the latter's de-dollarisation efforts, stated that any such move will severely impact the US economy itself.
"It will have a severe impact on the US economy itself, because America does not produce many of the things and is dependent on many other countries for imports. So if you increase the value of imports by 100 per cent tarrifs, American products which use these imports as some kind of intermediate things, they will become uncompetitive, and America in terms of of domestic economy, in terms of foreign trade will also take a great hit," Sharma said.
He further added, "This de-dollarization move has been going on for the last four to five years. It has gained momentum in the last two years when the US Fed raised the interest rates and Russia invaded Ukraine. The cost of US debt rose sharply. The imports from other countries also rose sharply. This would be a long-drawn battle. We do not see any immediate result... The entire capitalist system is based on the concept of free trade, free market economy. This will give a severe dent to the global process and also ultimately hurt the American economy."
In an X post, Trump said that his administration would impose 100 per cent tariffs on all imports from the BRICS countries, should they dare to launch their currency.
With growing global fragmentation, and geopolitical and geostrategic shifts, de-dollarisation plans are gathering currency. On the other hand, BRICS countries are working on reducing dollar dominance in the global financial system by replacing it with a new global currency.
The US commands its influence by way of its dollars. Reportedly, an idea was floated at the recent BRICS summit for the launch of a currency, which can be used for trade between the member countries. The US sees this idea as a threat as that would reduce the dollar's dominance.
Trump, in his X post earlier, asserted the idea that the BRICS Countries are trying to move away from the Dollar while the US stands by and watches 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 US dollar or, they will face 100 per cent tariffs, and should expect to say goodbye to selling into the wonderful US economy."
Trump added that 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.
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