International Relations and Cooperation Minister Ronald Lamola. Photo: Phill Magakoe/Gallo Images
South Africa has never advocated for Brics to serve as a political counter to the West or to create a currency to rival the dollar, International Relations Minister Ronald Lamola said on Monday in response to Donald Trump’s warning to the bloc.
“We have always been very clear about the role of Brics, that we see it as a developmental platform, which is mutually beneficial, “ Lamola told the Mail & Guardian.
“We continue to participate on that basis.”
Lamola on Monday recalled that the New Development Bank, the so-called Brics banks founded a decade ago, has become a source of financing for South African parastatals.
“The New Development Bank has given us loans, for Transnet, for infrastructure development, for water, and those loans are helpful for our country.
“That is why we saw Brics as a counterbalancing measure and joined and started this measure of the bank, because it is critical for us to have alternative platforms of financing.”
The US president-elect on Saturday threatened, in posts on his social media platform Truth Social, to impose 100% tariffs on the nine Brics nations if they were to create a currency to rival the dollar.
“We require a commitment from these countries that they will neither create a new Brics currency nor back any other currency to replace the mighty US dollar or they will face 100% tariffs and should expect to say goodbye to selling into the wonderful US economy” Trump wrote.
“They can go find another sucker. There is no chance that the Brics replace the US dollar in international trade, and any country that tries should wave goodbye to America.”
Lamola said South Africa has never been a vocal proponent of creating a Brics currency.
“There has never been this position of de-dollarisation,” he said.
“Our position has always been that Brics partners endeavour to trade in their local currencies, and experts say when you do that, it is cheaper.”
At the weekend, Lamola’s spokesperson, Chrispin Phiri, responded indirectly to Trump’s posts by referring in a post on X to an incident at the Brics summit in Kazan, Russia, in October when Russian President Vladimir Putin posed with a mock-up of a bill bearing the flags of Brazil, Russia, India, China and South Africa.
The image wrongly led many to believe that Brics had officially launched a joint currency, Phiri wrote.
“The currency that President Putin is holding is a mock-up of a Brics bill at the Kazan summit presented to him by enthusiasts and not an officially adopted Brics currency note.”
Lamola’s predecessor, Naledi Pandor, last year cautioned that any move towards a Brics currency could have economic repercussions.
“It’s a matter we must discuss and discuss properly. I don’t think we should always assume the idea will work because economics is very difficult and you have to have regard to all countries, especially in a situation of low growth when you are emerging from crises,” Pandor said at the time.