The year is 2025, and the global landscape has undergone significant transformations. Yet, some nations continue to rely on outdated strategies, believing that threats of tariffs and sanctions can influence the international community.
Recently inaugurated U.S. President Donald Trump announced plans to impose a 100 percent tariff on BRICS nations if they persist in their de-dollarization initiatives. \\"As a BRICS nation, they'll face a 100 percent tariff if they even consider proceeding with their plans, and they'll abandon them immediately,\\" he declared on his first day in office.
In response, the Chinese Ministry of Foreign Affairs emphasized that the BRICS alliance is centered on cooperation and shared prosperity, not confrontation. The world is increasingly dismissing one-currency dominance and sanction-driven pressure.
Consider Russia's experience. When faced with a barrage of sanctions from the West in 2014 and 2022, many anticipated an economic collapse. Instead, Russia developed its own financial systems. The System for Transfer of Financial Messages (SPFS) emerged as a domestic alternative to SWIFT, and the Mir payment card, launched in 2017, now serves functions similar to Visa and MasterCard. These initiatives insulated the Russian economy and strengthened financial ties with non-Western partners like Türkiye, Kazakhstan, and nations in the Middle East, reducing reliance on Western-controlled systems.
Similarly, Türkiye faced restrictions from the United States on access to U.S. technology and equipment, including F-35 jets and armed unmanned aerial vehicles. In response, Türkiye invested in domestic production of such equipment and has begun exporting to Middle Eastern and African nations.
These examples illustrate a broader global shift. More countries are seeking a balanced and equitable world order. Last year's G20 Summit in Brazil marked a historic moment with the African Union participating as a full member for the first time, signaling a new vision for international cooperation.
BRICS nations are redefining global trade norms by conducting commerce in their own currencies, thereby reducing dependence on the U.S. dollar. Brazil and China now trade using their national currencies, a practice adopted by India and its regional partners as well. The BRICS New Development Bank has increased efforts to finance projects in local currencies, offering an alternative to traditional Western financial institutions. Efforts are also underway to establish a BRICS blockchain-based payment system.
This shift is driven by pragmatism rather than political posturing. The global community has witnessed the vulnerabilities of a dollar-dominated system, with financial crises impacting economies worldwide. From the 2008 financial crisis to the pandemic-induced global recession, over-reliance on the dollar has presented significant risks.
The changing dynamics highlight that threats, sanctions, and one-currency dominance are increasingly ineffective in a multipolar world. Nations are exploring new avenues for cooperation, fostering resilience, and promoting mutual growth. As the global economic landscape evolves, it becomes clear that collaboration and innovation are the pathways to shared prosperity.
Reference(s):
Why threats, sanctions and one-currency dominance are past their prime
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