South Africa Denies Plans for BRICS Currency Amid Tariff Threats
TLDR
- South Africa's government dismissed reports of a planned BRICS currency.
- This follows threats by U.S. President-elect Donald Trump to impose 100% tariffs on bloc members supporting an alternative to the dollar.
- Instead, BRICS discussions focus on using national currencies for trade among member states.
South Africa's government dismissed reports of a planned BRICS currency, following threats by U.S. President-elect Donald Trump to impose 100% tariffs on bloc members supporting an alternative to the dollar.
Instead, BRICS discussions focus on using national currencies for trade among member states, according to the Department of International Relations and Cooperation (Dirco). The rand weakened 0.4% to 18.1283 against the dollar, mirroring broader emerging-market currency declines driven by dollar strength.
BRICS, comprising Brazil, Russia, India, China, South Africa, and others, advocates reforms to the global financial system but has not agreed on a shared currency. The bloc’s New Development Bank remains reliant on the dollar, with investments exceeding $30 billion across member states and other developing economies.
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Key Takeaways
South Africa supports increased use of national currencies to reduce reliance on the dollar in trade, aiming to mitigate foreign exchange risks. Strengthening correspondent banking and settlement infrastructure is key to achieving this goal, rather than pursuing full de-dollarisation or a unified BRICS currency.
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