Venezuela is going through an economic crisis and hyperinflation and now country’s President Nicolas Maduro, in his efforts to hold onto his plunging cash pile has been trying to pull the $1.2 billion worth of gold out of the Bank of England.
But the bank has denied Maduro Official’s requests after the top US officials including National Security Adviser John Bolton and Secretary of State Michael Pompeo lobbied their UK counterparts to cut off the deal, reported Bloomberg.
The UK is now actually following other countries in recognizing the National Assembly leader Jun Guiado as the legitimate president of Venezuela after Maduro who is an authoritarian ruler refuses to give up power. Maduro who has has been overseeing the country’s collapse into crisis.
The $1.2 billion of gold is a big chunk of $8 billion of foreign reserves held by the central bank of Venezuela. The US officials are now trying to steer the overseas assets of Venezuela to Guiado to help him take control of the govt.
According to the recent CNBC report, the gold holdings of Venezuela in the Bank of England have jumped after it closed a deal with Deutsche Bank. In December, Venezuela's holdings in the ban doubled to $1.3 billion after Venezuela returned the borrowed funds from Deutsche Bank AG.
Since last year, the government of Nicolas Maduro has been seeking to repatriate $550 million in gold from the bank of England on the fears of that the gold could be caught up in the sanctions on the country.
The Bank of England has been facing political pressure from the British parliament and Venezuela’s opposition to not assist Maduro. Now, losing the gold would be a blow to the country's finances. Also, by refusing to hand over the gold, this can cause an alarm among the countries that store their own gold with the Bank of England.
Maduro says his govt. is a victim of an “economic war” that is led by the opposition and the sanctions put by the US.
According to Ricardo Hausmann, a Harvard economics professor and a critic of Maduro’s, “The first rule of business as we speak is to stop the Maduro government from liquidating international assets of the country and steal them,” quoted Bloomberg.