The Impact of US Tariffs on BRICS Plus Trade Relations

In 2025, US President Donald Trump threatened to impose an additional 10% tariff on exports from BRICS-aligned countries to the United States. This move was in response to the growing influence of BRICS Plus and its efforts to reduce the dominance of the US dollar in global trade. This article examines the impact of these tariffs on BRICS Plus trade relations, the group’s responses, and the long-term implications.

Historical Context

Since its inception, BRICS Plus has aimed to create a more equitable global economic system. With its expanded membership of 10 countries, the group has become a significant challenge to the US-dominated financial system. The US tariff threats, announced in July 2025, were a reaction to BRICS Plus’s push to reduce dollar dependency. Trump argued that BRICS was designed to undermine the dollar’s value, and the tariffs were intended to curb the group’s influence.

Impact of Tariffs on BRICS Members

The US tariffs have varying impacts on BRICS Plus members. India, with 55% of its exports to the US affected, faces an effective tariff rate of 36%, one of the highest among major economies. Brazil has also faced punitive tariffs, exacerbated by political tensions, including the prosecution of its former president. South Africa, due to disputes over land reforms, faces high tariffs that could reduce its agricultural exports to the US.

In contrast, countries like Iran and Russia, already under extensive sanctions, are less affected by these tariffs due to their limited direct trade with the US. However, the tariffs could indirectly impact their trade with other BRICS members reliant on the US market.

BRICS Plus Response

In response to the tariffs, BRICS Plus members have intensified efforts to strengthen intra-group trade. Brazilian President Luiz Inácio Lula da Silva proposed a collective BRICS response, including increased trade in national currencies and the expansion of the BRICS Pay platform. Introduced in 2023, BRICS Pay facilitates low-cost cross-border transactions, helping members mitigate the effects of Western sanctions and tariffs.

Additionally, BRICS Plus is investing in transit corridors to reduce reliance on Western markets. The North-South Corridor, with Iran as a key hub, could enhance trade between India and Russia, bypassing Western-controlled routes.

Long-Term Implications

The US tariffs may serve as a catalyst for closer integration within BRICS Plus. By encouraging members to seek new export markets and boost intra-group trade, the tariffs could accelerate the group’s efforts to reduce dollar dependency. However, internal rivalries, particularly between China and India, pose a challenge to this integration. China’s dominant role in BRICS trade, often at the expense of other members’ domestic industries, could create tensions.

Moreover, the tariffs have had unintended consequences for the US economy. Their announcement in April 2025 led to a $5 trillion drop in the S&P 500 and increased US government borrowing costs, highlighting the fragility of protectionist policies.

Conclusion

While designed to curb BRICS Plus’s influence, US tariffs may have the opposite effect, pushing the group toward greater economic independence. By strengthening intra-group trade and developing independent trade infrastructure, BRICS Plus is positioning itself as a leader in redefining the global economic order. However, its success will depend on managing internal divisions and overcoming external pressures.

Source: Hamshahri Online – BRICS Economic Threat or Trump’s Admission of Weakness