'Can't depend on dollar': Brazil President Lula says 'Brics should test a new currency' amid trade tensions with US
Amid escalating trade tensions with the U.S., Brazilian President Lula da Silva champions a BRICS trade currency to reduce reliance on the dollar. Despite Trump's tariff threats and refusal to engage directly, Lula seeks support from leaders like Xi Jinping and Modi. Brazil plans WTO action against U.S. tariffs while remaining open to diplomatic resolutions, emphasizing dialogue over economic retaliation.
BRICS leaders with inset of commemorative currency note President Luiz Inácio Lula da Silva has reiterated his support for a BRICS trade currency, saying Brazil "cannot depend on the dollar" and must remain open to testing alternatives for trade among member nations. In social media videos circulating widely, Lula clarified, 'We do not want to mess with the dollar, it's an important currency. But we can have a currency for trade in BRICS — it's an idea we have to test.' He added, 'Not seeking to undermine the dollar, [we] recognize it as an important currency,' while maintaining that BRICS should be open to 'testing a common trade currency.'Amid Trump's tariff war, the Brazilian president has again brought up the issue of BRICS countries having their own currency. Lula has also proposed that BRICS nations begin discussions on creating such a shared trade currency, arguing it would reduce global dependence on the U.S. dollar. 'We need to test it,' Lula said. 'If it fails, then I was wrong — but someone would have to convince me that I was wrong.' His remarks come amid escalating trade tensions with the United States.
The United States has imposed a 50% tariff on Brazilian goods, adding to an existing 10%, prompting Lula to announce that Brazil will seek recourse through the World Trade Organization (WTO) and other formal diplomatic channels. He also confirmed he will not engage directly with U.S. President Donald Trump in light of the dispute.In January 2025, Trump publicly threatened a 100% tariff on BRICS countries if they pursued the creation of a shared currency. 'Any attempt by BRICS to form a trade currency that bypasses the dollar will be met with full-scale tariffs. 100% — no exceptions,' he said during a campaign rally.In early July, Trump reinforced his administration's hardline stance via social media: 'Any country aligning themselves with the Anti-American policies of BRICS will be charged an ADDITIONAL 10% tariff. There will be no exceptions to this policy.'
Lula emphasized Brazil's broader aim of reducing its dependency on the dollar. 'We want independence in our policies, we want freer trade, and things are progressing wonderfully. We are even discussing the possibility of creating our own currency, or perhaps using each country's national currency for trade, without relying on the dollar,' he said.In a televised interview with Jornal da Record TV, Lula said Trump's actions reflect discontent over BRICS' rising global influence. 'I am not obliged to purchase dollars to trade with countries like Venezuela, Bolivia, Chile, Sweden, the European Union, or China. We can use our own currencies. Why should I be tied to the dollar, a currency I do not control? It's the United States that prints dollars, not us.'Rejecting Trump's earlier offer to speak 'anytime,' Lula said, 'He does not want to talk.' Instead, the Brazilian president stated, 'I will call Xi Jinping, I will call Prime Minister Modi, I won't call Putin, because he can't travel now, but I will call many Presidents.'Despite ongoing tensions, Lula confirmed that Trump will still receive an invitation to COP30, the United Nations climate summit set to take place in Belém, Pará this November.The 50% tariff affects a wide range of Brazilian exports, though exemptions include civil aircraft and parts, aluminum, tin, wood pulp, energy products, and fertilizers. Trump said the decision was in response to what he called a 'witch hunt' against former Brazilian President Jair Bolsonaro, who is currently facing charges related to an alleged coup attempt following the 2022 election.Calling the move 'the most regrettable' moment in Brazil, U.S. relations, Lula reaffirmed Brazil's intention to strengthen trade ties with BRICS nations and other global partners.Although Lula has ruled out direct talks with Trump, he emphasized that Brazil remains open to negotiations through international bodies. 'In 2025, we will resort to all possible measures, starting with the WTO, to defend our interests,' he said.Speaking at the White House, Trump said Lula was welcome to contact him at any time and expressed admiration for the Brazilian people. 'The people running Brazil did the wrong thing,' he added.Brazilian Finance Minister Fernando Haddad welcomed the tone of Trump's remarks, describing them as 'great,' and noted that Lula could be open to talks if approached through appropriate diplomatic channels.Lula called for differences to be resolved through dialogue rather than economic retaliation. 'If he [Trump] had a disagreement, the right thing to do would be to raise the issue at a G20 meeting, have a civilized discussion, convince us, and talk it through. What he can't do is act like he owns everyone else,' he said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
&w=3840&q=100)
First Post
6 minutes ago
- First Post
Faulty math and accounting tricks: How much has DOGE inflated its savings numbers
Between February and July, DOGE's verifiable savings from cancelled contracts came to about $1.4 billion, far short of the $32.7 billion the agency claimed for that period. How did the numbers get so inflated? A man sprays paint graffiti against Elon Musk's Department of Government Efficiency (Doge) on a Tesla showroom in New York, US, April 22, 2025, in this still image taken from video. Extinction Rebellion NYC via Reuters The Trump administration's flagship cost-cutting agency, the Department of Government Efficiency (DOGE), says it has saved taxpayers more than $54 billion by tearing up federal contracts and taking a hard line on spending. A closer look at public data suggests those claims are greatly inflated. An analysis of federal spending records by POLITICO found that between February and July, DOGE's verifiable savings from cancelled contracts came to about $1.4 billion, far short of the $32.7 billion the agency claimed for that period. STORY CONTINUES BELOW THIS AD Even then, none of that money will reduce the federal deficit unless Congress takes back the funds. Under current law, most of it stays with the agencies, which must spend it. Counting credit limits as cash in hand DOGE uses the maximum possible value of each contract as its baseline for 'savings' — the ceiling value, not the amount actually committed. Contract experts say that approach is like canceling a credit card with a $20,000 limit and claiming you just saved $20,000. In many cases, these ceiling figures far exceed what the government was likely to spend. The White House insists DOGE's data is sound. Spokesman Harrison Fields said the figures are 'rigorously scrubbed' with agency officials and updated in real time. But POLITICO found that about 40 per cent of claimed savings from posted contracts could not be verified because DOGE withheld identifying details. Lowering the ceiling instead of closing the account In many cases, DOGE is not canceling contracts outright but lowering their ceiling values. That reduces the theoretical maximum cost, but it does not mean those dollars would have been spent. For the contracts that could be traced, ceiling reductions totaled about $14 billion— well below the $32.7 billion in claimed savings. Some cancelled contracts have even been restarted. At the Department of Veterans Affairs, DOGE claimed $932 million in savings from cancellations, including a suicide prevention services contract. Records show the VA recovered only $132 million, then reinstated the suicide prevention work. Headline figures vs. reality on the ground One of DOGE's largest single claims involves a migrant shelter contract in Pecos, Texas. DOGE said canceling it would save $2.9 billion. In reality, the maximum savings before the contract's scheduled review date in November would be about $126 million — roughly 4 per cent of DOGE's claim. The inflated number came from subtracting the $428 million actually obligated from the $3.3 billion ceiling. Another example is a consulting contract at the Energy Department to help set appliance efficiency standards. DOGE listed it as canceled, claiming $166 million in savings. The department says it was reduced, not cancelled, and that the real change was lowering the ceiling by just under $100 million. No funds have been returned. Hard to measure, harder to prove Experts note that true savings from canceling contracts are difficult to calculate. Terminations can trigger extra costs such as paying for work already done, settling leases, or covering subcontractors' expenses. Those bills can take years to finalise. By law, agencies must spend the money Congress gives them, even if a contract is canceled. They can shift it to other priorities but cannot simply leave it unspent without a formal rescission from Congress. A shrinking 'wall of receipts' DOGE's online 'wall of receipts,' a public log of terminated contracts, has seen slower updates since Elon Musk left the agency in May. The page went weeks without new entries this summer. Musk has since turned on Trump, criticising a spending bill the president signed in July and promising to launch his own third party to push for deeper cuts. STORY CONTINUES BELOW THIS AD For now, DOGE's lofty savings numbers remain a staple of administration talking points. But federal records suggest the truth lies somewhere in the middle, well below the headline figures and far above zero, with the real impact still years from being known.
Time of India
6 minutes ago
- Time of India
Tariff Shock: $7 bn India–US auto parts trade braces for big impact
The US's new tariffs on Indian auto components are set to cause immediate disruption, with analysts and industry experts warning that 15-20 per cent of India's exports to its largest auto-parts market could be lost in the short term, ToI reported. The US accounts for 27 per cent of India's auto component exports, meaning around 8 per cent of the country's total production will be directly affected, said Jitin Makkar, group head and senior vice-president (corporate ratings) at ICRA . According to the Automotive Component Manufacturers Association (ACMA), exports to the US stood at nearly $7 billion in 2024. Of this, $3.6 billion worth of parts and components for cars and small trucks will now attract a 25 per cent duty. The bigger hit will come from the remaining $3 billion, which includes commercial vehicle parts, construction equipment components, off-highway machinery, and tractor and farm equipment parts, all of which will face a reciprocal tariff of 50 per cent. While larger original equipment manufacturers are already exploring alternative markets, the impact will be most severe for small and medium-sized enterprises (SMEs) that make up the bulk of the sector. Noble Cast Comp, an aluminium casting manufacturer in Bhosari, sends 60 per cent of its products to the US. Its chairman and managing director, Nitin Bhagwat, said American customers were already asking the company to share the tariff burden, which would squeeze profit margins. In Pimpri Chinchwad, R K Industries exports computer numerical control machined components to global auto firms, with 20 per cent of its shipments going to the US. 'Effects are expected to be felt from next month, with US customers likely seeking price reductions due to increased landing costs and clients may also explore alternative suppliers from countries with lower costs,' said the company's operations head, Nilesh Khaire. The effective duty rates will range from 25-28 per cent to 45-50 per cent, depending on the product category, and the extent of the impact will vary based on how essential the exported component is. Ravindra Patki, managing partner at Vector Consulting Group, said, '30-40 per cent of India's auto component exports to the US comes from programmes in which India is one of multiple approved suppliers with a defined share of business.' For larger exportable parts, Indian suppliers will be at a disadvantage compared with exporters from countries such as Japan, Vietnam and Indonesia, which face lower tariffs of 15-19 per cent. Component makers say much will depend on their individual ties with US buyers. Sipra Engineering managing director M Umadi said, 'US customers, accounting for 28-32 per cent of exports, have assured support if we maintain cost, quality and delivery standards, but may request cost reductions later.'
&w=3840&q=100)
Business Standard
6 minutes ago
- Business Standard
Trump aims for Ukraine ceasefire at Alaska summit with Putin, says Macron
Speaking after the virtual meeting between Trump, Ukrainian President Volodymyr Zelenskyy and other European leaders, Macron said Trump was prioritising a ceasefire between Ukraine and Russia AP Berlin French President Emmanuel Macron says US President Donald Trump was very clear in a meeting with European leaders that the US wants to achieve a ceasefire at the summit with Russian President Vladimir Putin in Alaska. Speaking after the virtual meeting between Trump, Ukrainian President Volodymyr Zelenskyy and other European leaders, Macron said Trump was prioritising a ceasefire between Ukraine and Russia. He added that Trump had been clear that territorial issues relating to Ukraine ... will only be negotiated by the Ukrainian president. Following his meeting with the Russian leader, Trump will also seek a future trilateral meeting one involving Trump, Putin and Zelenskyy, Macron said. I think that's a very important point in this regard. And we hope that it can be held in Europe, in a neutral country that is acceptable to all parties, Macron said. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
