Russia Affirms BRICS Payment System Development Despite Trump’s Sanction Threats
MOSCOW, 05/12/2024 – Russia has confirmed its commitment to advancing the BRICS bloc’s payment settlement system, dismissing threats from U.S. President-elect Donald Trump to impose 100% tariffs on nations supporting alternatives to the U.S. dollar.
Russian Deputy Foreign Minister Alexander Pankin, speaking to the RIA news agency on Friday, stated that the development of the system is progressing and will not be derailed by external pressure. “Of course, it will continue,” Pankin affirmed, emphasizing the project’s focus on creating a robust settlement mechanism within BRICS rather than introducing a new international currency.
Trump’s Ultimatum to BRICS Nations
President-elect Trump has issued a stern warning to BRICS members—Brazil, Russia, India, China, and South Africa—demanding they refrain from creating or backing any currency that could challenge the dominance of the U.S. dollar. Trump threatened to impose 100% import tariffs on goods from nations pursuing such initiatives, framing his stance as a defense of U.S. economic security and dollar supremacy in global markets.
In a statement last week, Trump called on BRICS members to “respect international financial norms” by committing to the dollar as the primary global currency. He labeled any alternative currency as a potential threat to U.S. interests, signaling that his administration would adopt a hardline approach to safeguard dollar dominance.
BRICS Payment System: A Strategic Initiative
The BRICS settlement system, in development for years, aims to create a mechanism for cross-border transactions among member nations without relying on the U.S. dollar. The initiative is part of a broader strategy to reduce dependence on Western-dominated financial systems and counteract the impact of sanctions.
While there has been speculation about BRICS creating a shared currency, Deputy Minister Pankin clarified that the current focus is on the payment system, which would facilitate trade in local currencies. Such a system is expected to enhance financial sovereignty, minimize transaction costs, and provide member countries with an alternative to SWIFT, the Western-controlled international payments network.
Russia’s Determination
Russia has been a vocal proponent of de-dollarization, particularly after facing extensive U.S.-led sanctions in recent years. The Kremlin views the BRICS payment system as a cornerstone of its economic strategy to reduce exposure to Western financial influence and strengthen ties with key allies.
“Sanctions and pressure are a reality we are prepared to face, but they will not halt progress,” Pankin said, reiterating Moscow’s determination to continue the initiative.
Implications for Global Trade
The development of a BRICS payment system could have far-reaching implications for international trade and finance. If successful, it may challenge the dollar’s hegemony, offering emerging economies an alternative platform for trade and investment.
However, experts warn that Trump’s tariff threats could escalate tensions between the U.S. and BRICS nations, potentially sparking a broader trade conflict. Analysts also note that implementing such tariffs could disrupt global supply chains and harm U.S. consumers by driving up prices on imported goods.
A Test of Economic Independence
For BRICS, the payment system represents more than just a financial tool; it is a statement of intent to reshape global economic governance. Despite external threats, member nations appear committed to pursuing financial mechanisms that align with their long-term goals of independence and resilience.
As tensions between the U.S. and BRICS escalate, the coming months will reveal how effectively the bloc can navigate these challenges while advancing its vision for a multipolar economic order.