Venezuela targets $4.4B London gold stash

Venezuela’s government and opposition have agreed to jointly pursue the return of about 31 tonnes of gold held at the Bank of England in a plan to help finance reconstruction following the country’s devastating June earthquakes, the Financial Times of London reports.

The gold is worth about $4.4 billion (C$6.11 billion) at current prices, according to the Times and Reuters on Friday.  

The agreement marks a rare point of cooperation between the two sides after U.S.-backed negotiations this month. Officials said they intend to seek the recovery of Venezuela’s international reserve assets in London while establishing safeguards over how the funds would be used.

The gold has remained frozen since 2018 because the UK recognized opposition leader Juan Guaidó, rather than Nicolás Maduro, as Venezuela’s interim president. British courts have spent years weighing which rival central bank board had the legal authority to control the reserves, leaving the bullion locked in London.

King’s consent

Acting President Delcy Rodríguez last month appealed directly to King Charles to release the gold, while opposition representatives have said any transfer should be accompanied by transparency measures to ensure the money is spent on reconstruction rather than diverted elsewhere.

The push comes as Venezuela grapples with the economic impact of the June earthquakes, which killed more than 6,000 people and damaged homes, hospitals and infrastructure. The country’s central bank said the disaster contributed to a sharp rise in inflation in July by disrupting the distribution of goods.

Venezuela last reported official gold reserves of about 161 tonnes in 2018, International Monetary Fund data show. That puts the London-held bullion at roughly one-fifth of the country’s reported holdings then.

Even with political backing from both sides, recovering the gold is expected to be legally complex because ownership of the reserves remains tied to the unresolved recognition dispute that has kept the assets frozen for nearly eight years.