Who Wins in 2025?

By Joel Wong

The opinion is that of Frank Giustra – CEO of Canadian Fiore Group: With Donald Trump returning to power, tensions between the United States and China are expected to escalate further, impacting global markets and accelerating trends like de-dollarization as nations seek alternatives to the US dollar, including BRICS initiatives and gold-backed currencies.

Key Takeaways:

Trump’s Leadership Impact: A Trump presidency could intensify US-China strategic rivalry through heightened trade tensions, tariffs, and punitive measures against countries adopting de-dollarization.
De-dollarization Momentum: Nations are increasingly exploring alternatives to the US dollar due to concerns about sanctions, exemplified by projects like mBridge, which aim to create alternative trading systems.
BRICS and Alternative Frameworks: The rise of BRICS and similar coalitions challenges the US-led global financial order, offering new platforms for economic and trade collaboration.
Ineffectiveness of Sanctions: US reliance on sanctions is viewed as counterproductive, fostering resentment and motivating nations to seek alternative systems outside the dollar’s dominance.
Gold Over Bitcoin: Central banks in non-G7 nations are favoring gold as a stable investment over cryptocurrencies like Bitcoin, signaling a divergence in global economic strategies.
Impending Monetary Reset: A significant reorganization of the global monetary system is anticipated, with gold expected to play a crucial role in cross-border and regional trade.
Shifting Foreign Policy: A more transactional approach in US foreign policy appears likely, reflecting evolving global power dynamics and declining influence of Western values-based diplomacy.

Policy Implications of a Trump Presidency:

Economic Penalties: Imposing steep tariffs on nations pursuing de-dollarization could strain global trade and provoke retaliatory measures from China and other nations.
Military Posturing: Increased US military presence in the Asia-Pacific region could escalate tensions with China, prompting stronger countermeasures from Beijing.
Strengthened Alliances: Efforts to form stronger alliances in the Indo-Pacific to counterbalance China’s influence may further isolate Beijing diplomatically and economically.
Technology and Trade Restrictions: Expanded restrictions on Chinese technology and trade sectors could deepen trade conflicts and slow global technological integration.
“America First” Doctrine: A unilateral approach to international issues may hinder cooperative efforts and exacerbate tensions with key global players.

Broader Impacts of De-dollarization:

Global South Alliances: Nations in the Global South are increasingly aligning with alternatives like BRICS, fostering a multipolar world and diminishing US economic dominance.
Economic Fragmentation: Protective measures and alternative trade coalitions could lead to a fragmented global economy, reducing reliance on the dollar and reshaping international trade norms.
Challenges for Global Institutions: Traditional institutions like the IMF and World Bank may struggle to adapt as new coalitions attract marginalized nations, challenging the existing global financial order.

Conclusion:

The evolving dynamics between the US and China, influenced by leadership changes and growing global discontent with dollar dominance, signal a profound shift in international economic and political structures. The rise of alternative coalitions like BRICS, coupled with de-dollarization, highlights the need for strategic adaptations to maintain stability in an increasingly multipolar world.