Venezuela opposition leader begs the Bank of England not to send $1.2 billion in gold to Maduro’s ‘illegitimate and kleptocratic regime’

Venezuela's President Nicolas Maduro (C) holds a gold bar

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Venezuela’s President Nicolas Maduro (C) holds a gold bar
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Miraflores Palace/Handout via Reuters

  • Guaidó sent a letter to UK Prime Minister Theresa May and Bank of England Governor Mark Carney, asking them not to allow access to $1.2 billion of Venezuelan gold reserves to President Nicolas Maduro.
  • Maduro wants to sell the gold, and the money would be used “to repress and brutalize the Venezuelan people,” Juan Guaidó wrote in the letter.
  • Maduro’s government in November approached the Bank of England about removing roughly 16.5 tons of gold – worth about $550 million. That figure has more than doubled after a deal with Deutsche Bank.

Juan Guaidó, whom the US and about a dozen other countries recognize as the new Venezuelan president, sent a letter to UK Prime Minister Theresa May and Bank of England Governor Mark Carney asking them not to allow access to $1.2 billion in Venezuelan gold reserves by “the illegitimate and kleptocratic regime” of President Nicolas Maduro.

Citing the letter, Reuters reported that Guaido said Maduro government officials were seeking to sell the gold and move the proceeds to Venezuela’s central bank.

“I am writing to ask you to stop this illegitimate transaction,” Guaido said in the letter, which Reuters said was letters released by Guaidó’s party on Sunday. “If the money is transferred … it will be used by the illegitimate and kleptocratic regime of Nicolas Maduro to repress and brutalize the Venezuelan people.”

Read more: Venezuela really, really wants its $550 million of gold back. And it’s going to the Bank of England to get it.

The government of Maduro in early November approached the Bank of England about removing roughly 16.5 tons of gold – worth about $550 million – from the central bank’s vaults and returning it to South America. Emerging market nations frequently store gold reserves in foreign central banks.

Last week, Reuters reported that the amount of gold Venezuela holds at the Bank of England had more than doubled to about 31 tons after Venezuela did a gold deal with Deutsche Bank.

Venezuela has been selling its sizeable gold reserves, built up under Hugo Chavez, to try to address the economic crisis plaguing the country. Hyperinflation of goods means everyday items are unaffordable for many Venezuelans, and poverty and violence are widespread.

Most recently, its drive to repatriate gold has been related to sanctions announced by the US aimed at disrupting the South American country’s gold exports.

A report from the International Monetary Fund last July said Venezuela’s economy was expected to contract by about 18% in 2018. Venezuela is struggling under hyperinflation now approaching 2 million percent annually.