Enlargement of BRICS: What Are the Consequences for the United States?
Hey there! Let's dig into the world of BRICS, a economic alliance that was originally formed by Brazil, Russia, India, China, and South Africa, but has since grown into something much bigger. This expansion, known as BRICS+, includes new members and partner countries aiming to shake up the dominant role of the US dollar in international trade.
As of 2025, BRICS consists of ten full members: Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates. Moreover, eight countries are on the path to full membership as partner states: Belarus, Bolivia, Cuba, Kazakhstan, Malaysia, Thailand, Uganda, and Uzbekistan.
One of the key objectives of BRICS is to decrease its reliance on the US dollar, particularly in oil trading. To achieve this, they're exploring options such as using their own currencies or even creating a new reserve currency. This could potentially have a huge impact on the global standing of the dollar.
Now, if BRICS manages to successfully trade oil without using dollars, there could be some serious consequences for the USA. For instance, a decrease in the use of the dollar in international transactions could weaken its value and influence, affecting its status as the global reserve currency, and in turn, US economic power. The decline in dollar demand could also lead to higher interest rates in the US to attract foreign investors, impacting domestic economic growth.
The US might retaliate with tariffs or trade restrictions to protect its economic interests. For example, President-elect Donald Trump has threatened BRICS countries with 100% tariffs if they pursue alternatives to the dollar.
Overall, the expansion and economic integration of BRICS has the potential to reshape the global financial landscape, reducing the dollar's influence and altering international trade dynamics. BRICS is working on strategies like currency diversification, stronger trade agreements, new financial institutions, and independent payment systems to achieve this goal.
In the context of BRICS's efforts to reduce its reliance on the US dollar, especially in oil trading, the creation of new alternatives such as using their own currencies or a new reserve currency could significantly impact the global finance business. Furthermore, if BRICS successfully trades oil without using the US dollar, it could lead to significant financial consequences for the United States, potentially causing a decline in the US dollar's value, influence, and status as the global reserve currency, and possibly impacting the US business sector through higher interest rates and reduced economic growth.
