As part of the BRICS bloc’s commitment to dedollarization initiatives, former US President Donald Trump and his economic advisers are drawing up plans to combat the alliance and save the US dollar. Indeed, Trump hopes to be re-elected in the next presidential elections in 2024, thanks to these efforts which will be at the center of his potential policies.
According to a Bloomberg report, Trump and his advisers are considering possible sanctions if he abandons the US dollar. These sanctions would be imposed on both allies and adversaries who engage in bilateral trade in currencies other than the greenback. Such actions would constitute the most poignant response the United States has ever made to dedollarization initiatives.
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Donald Trump wants to fight against the dedollarization of BRICS
Throughout the last year, the BRICS economic alliance has not shied away from efforts to reduce the importance of the US dollar. Indeed, it has taken concrete steps to promote its own local currencies in its place. Subsequently, countries that trade with the BRICS collective have tended to align with these dedollarization plans.
The United States has largely failed to answer this question, although that may soon change. Reports indicate that BRICS dedollarization initiatives are likely to be opposed by Donald Trump and his economic advisors who seek to save the US dollar.
The report notes that people familiar with the matter identify efforts by Trump and his advisers to address the issue head on. Specifically, they seek sanctions in order to maintain the dollar’s exposure to emerging markets. These sanctions would be imposed on those who conclude bilateral trade without the greenback.
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Policies discussed could include “export controls, currency manipulation fees and tariffs,” sources said. Additionally, these efforts would seek to hinder the growing movement that has gained momentum in 2022.
US sanctions against Russia following the invasion of Ukraine were a pivotal moment. More specifically, it highlighted the militarization of Western currencies. In turn, a multitude of countries have sought to diversify their foreign currency holdings. This effort was a potential defense against this type of Western practice in the future.
However, the use of the local currency was also an attempt to protect the nation from the current state of the dollar. With U.S. debt reaching record levels, its fragility required diversification. Subsequently, many countries saw an opportunity for their currencies to prosper. Yet Trump’s advisers are seeking to reverse this trend.
reference: watcher.guru