The global economic order is wavering due to the protectionist policies of the United States. The BRICS' quest for dedollarization faces new challenges amid the potential rise of the dollar.
US Protectionist Policies and the Dollar Surge
Under the leadership of Donald Trump, the US has relaunched an aggressive tariff policy affecting a wide range of imported products. This strategy aims to rebalance the trade balance and strengthen the dollar's status in international markets. According to Goldman Sachs, this policy is expected to have a mechanical effect on the dollar's value, making it more attractive to investors.
Challenges for BRICS in the Face of a Strong Dollar
The consequences of this policy extend beyond the US, affecting Mexico and Canada and increasing trade tensions. The BRICS countries, striving to reduce their dollar dependence, become particularly vulnerable. A strong dollar makes their imports more expensive, weakening their economic systems.
Potential BRICS Strategies in Response to a Strengthened Dollar
A key aspect of the BRICS' strategy is to diversify monetary transactions and establish a less dollar-dependent economic system. In this scenario, the bloc needs to revise its monetary strategy and seek stronger cooperation with other emerging nations. It remains to be seen whether this effort will challenge a dollar-dominated system or mark a resurgence of the greenback in global trade.
In the near term, the BRICS will need to accelerate efforts to adapt to new economic realities. Their success or failure may have long-term implications for the global financial system.
