Germany’s Chancellor plans lithium deal with Serbia after Rio ruling
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While Venezuela President Hugo Chavez may have little to gain from seizing the half he did not already own of the only private gold miner left in the country, bringing home the 211 tonnes of gold reserves, worth $12.3 billion, held overseas, is a different story altogether.
CTV news reports bullion traders are preparing for one of the largest transfers of physical gold in recent history – about 17,000 standard 400-ounce bars – from Europe back to the South American state. While billions of dollars worth of gold is traded every day, only a tiny proportion of it moves from vaults in London, New York and Zurich.
CTV News quotes a precious metals strategist at investment bank UBS: “There is a growing preference among many different communities in the gold market to have their physical gold at home.”
Reuters Breaking Views blog asks whether Chavez is ahead of the investment curve and says following the Chavez playbook is rarely a good idea, but in this case investors might be wise to take an asset transfer cue from him.
El Universal quotes Rafael Ramírez, Venezuela’s Minister of Energy and Petroleum: “Anyone who knows the southern part of the country, (particularly) the mining area of Guayana, realizes that gold has been in the hands of multinational companies that operate in different ways to perform covert and illegal activities.”
The paper also quotes Russian-Canadian miner Rusoro Mining Ltd., the only private gold miner left in the country, as saying it continues to produce gold from two projects and was developing two other projects in Venezuela. It also said that it has received no indications from the government about a change in the operations of the company.
According to Bloomberg News, Venezuela produces 11 metric tonnes of gold each year, compared to global production of more than 2,400 tonnes and China’s production of more than 300 tonnes.
The Washington Post reports about $6.5 billion in non-gold international reserves such as bank deposits and bonds will also be “spread out” to diversify Venezuela’s assets.
Comments
jamesont
It is only prudent that a country has its gold reserves in that country. It certainly makes more sense.