I searched and didn't see an existing thread dedicated to this topic, so SIAP.
Trump/USA recently dropped the hammer on Venezuela:https://www.bloomberg.com/news/artic...ressure-maduroPresident Donald Trump signed an executive order authorizing new sanctions on Venezuela’s gold sector, in a bid to disrupt trade with Turkey that U.S. officials fear is undermining efforts to pressure the South American nation’s president, Nicolas Maduro.
The order, signed Wednesday by Trump and announced at a speech Thursday by National Security Adviser John Bolton, targets people operating corruptly within Venezuela’s gold sector. It’s expected to significantly impact the country’s economy, according to a senior administration official who requested anonymity to discuss the announcement before it was made.
...
The Treasury Department is expected to outline implementation of the new Venezuela sanctions authority later Thursday. While the initial effort will focus on the country’s gold sector, Trump’s order gives the State and Treasury departments authority to target additional industries in the future.
“The new sanctions will target networks operating within corrupt Venezuelan economic sectors and deny them access to stolen wealth,” Bolton said. “Most immediately, the new sanctions will prevent U.S. persons from engaging with actors and networks complicit in corrupt or deceptive transactions in the Venezuelan gold.”
...
Venezuela’s gold industry has been under scrutiny by U.S. officials in recent weeks, with the Treasury Department noting that many mines are run by criminal gangs, a situation that is environmentally disastrous. The sanctions are likely to have a particular effect on trade with Turkey, with tons of gold sent there annually for refinement and processing. Officials have also voiced concern that some of the gold may find its way to Iran in violation of sanctions on the Islamic Republic.
...
Now, news is breaking that Venezuela wants to repatriate more of their gold from the BoE:https://www.reuters.com/article/us-v...-idUSKCN1NA1Q7Venezuela is seeking to repatriate about $550 million in gold bars from the Bank of England because of fears it could be caught up in international sanctions on the country, two sources with direct knowledge of the effort told Reuters.
Venezuela’s hard currency holdings have dwindled as existing U.S. financial sanctions have effectively blocked President Nicolas Maduro’s government from borrowing on international markets.
...
Maduro’s government is seeking to bring 14 tonnes of gold held in the Bank of England back to Venezuela, according to two public officials with direct knowledge of the operation, who asked not to be identified.
The Bank of England has sought to clarify what Venezuela wants to do with the gold, one of the officials said.
Venezuela’s central bank did not respond to a request for comment. The Bank of England declined to comment.
The plan has been held up for nearly two months due to difficulty in obtaining insurance for the shipment, needed to move a large gold cargo, one of the officials said.
“They are still trying to find insurance coverage, because the costs are high,” the official said.
...
The amount is equivalent to five times the total hard currency that Venezuela has sold in 2018 via hard currency auctions that are carried out under the country’s 15-year-old exchange control system, according figures compiled by local consultancy Sintesis Financiera.
...
But even if Venezuela manages to repatriate the gold, the new U.S. sanctions could make selling it to raise hard currency difficult.
“If the government wants to carry out operations with the gold that it plans to bring, it would have to be done with allied countries because of the sanctions,” said Tamara Herrera, an economist with Sintesis Financiera.
...
The country’s late socialist leader Hugo Chavez, citing the need for Venezuela to have physical control of central bank assets, in 2011 repatriated around 160 tonnes of gold from banks in the United States and Europe to the central bank in Caracas.
But some of Venezuela’s gold remained in the Bank of England. Starting in 2014, Venezuela used this gold for “swap” operations in which global banks lent Venezuela several billion dollars with the gold as collateral.
Venezuelan central bank statistics show the central bank’s gold holdings by June this year had dropped to 160 tonnes from 364 tonnes in 2014, as some of the swap agreements expired without Venezuela returning the funds - leaving the gold in the hands of the banks.
In 2017, such swap agreements became difficult due to U.S. sanctions, which blocked U.S. financial institutions from bankrolling any new financing operations.
"The Bank of England has sought to clarify what Venezuela wants to do with the gold ..."
What? If I make a withdrawal at a bank, and the banks "seeks to clarify what I want to do with my money", I tell them instead of a withdrawal, I'm closing my account. It's none of their business. Maybe the reporting here was just really bad (vague) and they meant they sought clarity in how the gold was to be shipped, but as written, the sentence is a head scratcher.
Held up for two months because insurance? Right... They manged to ship 160 tonnes home in 2011 but now face insurmountable hurdles shipping 14 tonnes. Very believable.
"But even if Venezuela manages to repatriate the gold ..."
I find it really odd for Reuters to suggest that Venezuela would not be able to repatriate their gold.
Site Information
About Us
- RonPaulForums.com is an independent grassroots outfit not officially connected to Ron Paul but dedicated to his mission. For more information see our Mission Statement.
Connect With Us