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Venezuela receives first repatriated gold shipment

December 1, 2011

Soldiers stand guard as one of the first armored trucks containing gold reserves
arrives at the Central Bank in Caracas, Venezuela, November 25, 2011

November 26, 2011
www.voanews.com

The government of Venezuelan President Hugo Chavez has begun repatriating gold reserves that had been held in European banks.

The gold bars were unloaded at Venezuela’s Maiquetia airport Friday and later transferred to armored vehicles for shipping to the Central Bank in Caracas. Officials did not say how much gold was brought back in the shipment. They also did not say when future shipments would arrive.

Back in August, President Chavez said that $11 billion of gold reserves held in U.S. and European banks would be returned to Venezuela. He has been quoted as saying the gold never should have left the country. Chavez has said the decision to retrieve the gold is aimed at helping protect Venezuela from economic troubles in the United States and Europe. Most of Venezuela’s gold held abroad is in Britain.

Some observers, however, believe that by repatriating the bullion, the Chavez government is reducing the risk of having its assets seized in arbitration cases, including those linked to nationalizations of private industries.

The president also has announced plans to move more than $6 billion in cash reserves to “friendly” banks in Brazil, China and Russia. The money is now held in European and U.S. banks.

From → World Watch

One Comment
  1. ewoon,

    Just to share this…

    2nd UPDATE: Venezuela Repatriates First Gold Shipment From Europe – WSJ.com – http://online.wsj.com/article/BT-CO-20111125-709970.html

    –Central bank says about $300 million of gold brought from European countries
    –Country aims to repatriate 160 tons out of 211 tons of gold held abroad
    –Move was announced by Chavez in August; analysts question motive
    (Adds detail on value of gold shipped in fourth paragraph.)

    By Kejal Vyas
    Of DOW JONES NEWSWIRES

    CARACAS (Dow Jones)–Venezuelan officials Friday welcomed the first air shipment of overseas gold holdings as part of a controversial move to repatriate the country’s foreign reserves held in North America and Europe.

    Crates holding gold bullion were shown on state television being offloaded at the capital city’s Maiquetia airport and onto armored vehicles. Central Bank President Nelson Merentes deemed the arrival a “historic” moment for Venezuela, saying the first shipment was coming from “various European countries” via France.

    Merentes said the government plans to eventually bring home 160 tons of gold over time. Before Friday, the country held 211 tons–nearly $11 billion worth–out of its 365 tons of gold reserves stored in U.S., Canadian and European banks. The country has the largest holdings in Latin America with nearly two-thirds of its $27.8 billion in international reserves held in the precious metal.
    Merentes didn’t specify the quantity of gold shipped on Friday but told a rally of supporters outside the central bank headquarters that it was valued at around $300 million In August, President Hugo Chavez announced plans to repatriate foreign reserves as part of a broader effort to nationalize the country’s gold sector.

    The move puzzled economists, who said it would further reduce transparency and raise more questions over the central bank’s declining reserves. Some analysts speculated that, faced with several international arbitration cases seeking billions of dollars over nationalizations, the left-leaning South American government was looking to shield itself from having its own assets seized.

    But Venezuelan officials say they aim to reduce exposure to debt-laden economies like the U.S. and those of Europe, while also taking advantage of the precious metal’s rising price. Venezuela also has said it aims to diversify by investing in faster-growing allied nations like Russia and China, both of which recently have been making large investments into the oil-rich South American country.
    “Now [the gold] will go to a place from which it should have never left: the central bank vaults [in Caracas]; not those in London or in Europe, but our own land,” Chavez said earlier in the day.
    The Central Bank of Venezuela already holds 154 tons of bullion domestically.

    In an interview last month, a senior central bank official told Dow Jones Newswires that Venezuela would leave behind a small portion of its overseas gold holdings to allow for any future transactions. At the time, he said that the entire repatriation operation would cost Venezuela “no more than $7 million,” including insurance.

    Prior to Friday’s transfer, the Bank of England held about 99 tons of Venezuela’s gold, with smaller amounts stored by the Bank for International Settlements in Switzerland, Britain-based Barclays Bank (BCS, BARC.LN), J.P. Morgan Chase & Co. (JPM) in the U.S. and Canada’s Bank of Nova Scotia (BNS, BNS.T), among other institutions, according to Venezuelan government documents.

    -By Kejal Vyas, Dow Jones Newswires; 58-414-249-6821; kejal.vyas@dowjones.com

    Shalom.

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