The Russian State Duma’s deputy chairman, Alexander Babakov, has brushed off President-elect Donald Trump’s recent threats to impose a 100% tariff on the BRICS group as unlikely. Although theoretically feasible, Babakov contended that such measures are unlikely to be implemented because of the substantial global economic interdependencies and the possible consequences of doing so.
Trump’s Proposal for Tariffs: A Betrayal?
Babakov criticized Trump’s proposal in a recent opinion piece that appeared in Izvestia, arguing that it is more bluster than substance. Trump’s threat was linked to the possibility that the BRICS nations might stop using the US dollar and adopt a single currency. Babakov stressed that BRICS may lessen their dependency on the dollar without having a common currency. Rather, he suggested a multilateral payment platform as a workable substitute to accomplish the same goal.
Encouraging Dollar Independence
Babakov laid up a plan for the BRICS to trade internationally without using the US dollar. This strategy entails the formation of a clearing system to ease cross-border transactions, the development of national digital currencies, and the creation of an offshore ruble. He contended that by taking these steps, the BRICS nations would be able to liberate their commerce from the dollar’s sway, which has been increasingly employed as a political instrument.
The Function of Blockchain in Economic Self-Sufficiency
Babakov also emphasized how important distributed ledger and blockchain technology are to the operation of this kind of payment system. Blockchain would serve as the foundation of a settlement platform that supports the BRICS’ objectives of economic sovereignty by facilitating safe and transparent transactions.
A Common Clearing Mechanism for the BRICS
Babakov reaffirmed in his remarks how crucial a single clearing exchange is to the BRICS bloc’s future. He pointed out that a platform like this would be crucial to reaching economic independence and boosting trade between participating nations. “This exchange is the cornerstone of BRICS’ efforts to ensure their economic sovereignty,” Babakov said in an October speech.
Finally, Babakov’s comments highlight how blockchain technology and digital currencies have the power to change the nature of international trade. The BRICS nations seek to establish a more equitable and politically neutral framework for global trade by lowering their reliance on the US dollar.
