Venezuela’s gold - factsheet

According to the Venezuelan central bank, the country has 132 tonnes of gold between the central bank’s vault and the Bank of England. The sale of 3 tonnes to a UAE fund brings reserves to 129 tonnes, subtracting the amount held in the BoE leaves Maduro with at most 98 tonnes of gold (as it is unclear how much is being leased or swaped) or $4.14bn (at the price of $1,314/oz). A pproximately 31 t onnes ($1.3 billion) of Venezuelan gold are in the custody of the Bank of England. It has been reported that Maduro has been unsuccessful in attempting to retrieve this gold, with the U.K. lobbied by top U.S. officials to stop the regime from accessing its oversea assets. Domestic production: Venezuela’s gold production plummeted this decade. WBMS data suggest it has fallen from highs of greater than 10 tonnes a year in the mid 2000’s to <1T over the last five years. However, knowing the true figure is extremely difficult due to most production being via artisanal mining and because much of the production is being siphoned off. The World Gold Council suggests annual production is much higher, falling from 24.9 T in 2011 to 23.0 T in 2017. Most of the production takes place in the Orinoco mining belt in the east of the country. This area was conceived as a special mining zone by the late President Hugo Chavez in 2011, but did not turn into a megaproject until 2016 under Maduro. In 2017, the Ecological mining minister of Venezuela reported that the area produced 17 Tons of gold and that over 300 agreements had been reached with small miners, aimed at regulating activities. The resources are likely to be important in growing domestic production in the event of a regime change. Recent transactions : • Bloomberg reported that Venezuela exported $1.1 billion worth of gold to the UAE in December 2017. • The BBC reported that in 2018 Venezuela exported $900m worth of gold to Turkey. • April 2018, Venezuela paid $172mn to an American bank in order to recover some of the gold that it had swaped . Between 2014 and 2016 Venezuela leased some of its gold with the swaps progressively maturing by 2021. • January 2019 , it is reported that Venezuelan gold holdings in the Bank of England more than double d to 31 tonnes after Venezuela return ed funds from a gold collateral swap it had conducted with a German bank. The deal seems to have been struck in 2015. The Bank of England blocks Venezuelan gold withdrawals from its accounts. • Abu Dhabi investment firm Noor Capital announced it had bought 3T of gold from Venezuela’s central bank on the 1st February 2019. However, the U.S. has issued warnings that any firm dealing in gold with Venezuela would be subject to sanctions.