Trump tariff threat to dismantle Brics appears to be working

Time of India

5 days ago

TOI correspondent from Washington:
Amid continued turmoil and confusion over his threats to tax foreign imports into US, President Donald Trump held out a new warning to "any country aligning themselves with the Anti-American policies" of the Brics bloc: They will be charged an additional 10 per cent tariff without exceptions.
The threat, coming even as the Brics nations began a two-day summit on Sunday in Rio de Janeiro, follows a separate warning letter expected to be released on Monday to more than a dozen countries that have failed to clinch trade deals with Washington on US terms.
Trump had set a July 9 deadline for countries to agree a trade deal, but officials now say tariffs will begin on 1 August as most nations across the world, including India, refused to be browbeaten.
In the meantime, the Trump letter is expected to inform countries what the tariff rate will be if an agreement is not reached.
In Rio meanwhile, the Brics group, without naming the US, raised 'serious concerns' about the rise of tariffs which it said were 'inconsistent with WTO (World Trade Organization) rules.' The restrictions 'threaten to reduce global trade, disrupt global supply chains, and introduce uncertainty," the group said in a statement even as there was confusion even in Washington about the efficacy of the Trump approach.
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Trump has repeatedly targeted Brics countries in recent months threatening steep tariffs on them if they attempted to supplant the US dollar as the global reserve currency even as the bloc's GDP has now surpassed that of the G-7 nations.
'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% Tariffs, and should expect to say goodbye to selling into the wonderful US Economy,' he warned in January, asserting at the same time that there is 'no chance' Brics could replace the dollar and urging countries to 'go find another sucker nation' if they pursue de-dollarization.
Soon after, he expressed satisfaction that Brics -- which added another five countries to the original five and now has ten partner countries -- had broken up because of his warnings. "Brics states were trying to destroy our dollar. They wanted to create a new currency. So when I came in, the first thing I said was any Brics state that even mentions the destruction of the dollar will be charged a 150 per cent tariff, and we don't want your goods,' he said in February, declaring that 'Brics is dead' because of his tariff threats.
Indeed, the Brics summit in Rio has been a drawdown from earlier meets, with China's President Xi Jinping bailing out because of "scheduling conflicts" and Russia's Vlamidir Putin appearing only via video-link.
At the same time, the bloc has also expanded, with new members such as Egypt, Indonesia, and UAE, and partner countries such as Thailand and Vietnam. Some of these countries have closer ties with US than the original members, but almost all members, including China and Russia, are falling over themselves to signal Brics is not seeking a confrontation with the US and they seek to keep their economies -- which would stall if US raises trade barriers -- afloat.
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