Off The Wire
Venezuela files claim to force Bank of England to hand over gold
CARACAS (Reuters) - Venezuela’s central bank has made a legal claim to try to force the Bank of England to hand over €930 million ($1.02 billion) of gold so President Nicolas Maduro’s government can fund its coronavirus response, according to the document submitted in a London court.
The claim follows a request Venezuela made to the Bank of England in April to sell part of its gold reserves there and send the proceeds to the United Nations to help with the country’s coronavirus-fighting efforts.
The Bank of England declined to comment on the claim. The Venezuelan central bank did not respond to a request to comment.
Since 2018, the Bank of England has delayed the transfer of 31 tonnes of Venezuelan gold stored there to Maduro, who Britain does not recognize as the country’s legitimate leader. The bank offers gold custodian services to many developing nations.
The claim, submitted in a commercial court and dated May 14, says the Venezuelan central bank “seeks an order requiring BoE to comply with the proposed instruction.”
The funds, once transferred to the United Nations Development Programme, would be used to buy healthcare equipment, medicine, and food to address Venezuela’s “COVID-19 emergency,” the document seen by Reuters said.
Selling off the country’s gold reserves has become one of the Maduro administration’s few options to raise funds due to U.S. sanctions. The collapse in global oil prices and a paralyzing coronavirus quarantine has further crippled Venezuela’s moribund economy.
“The foot-dragging by the Bank of England is critically hampering Venezuela and the UN’s efforts to combat COVID-19 in the country,” Sarosh Zaiwalla, a London-based lawyer representing the central bank, said in a statement.
Venezuela so far has registered 618 coronavirus cases and 10 deaths, but health workers warn the country’s decrepit medical system could be overrun if the outbreak expands there.
Reporting by Mayela Arms and Corina Pons in Caracas; Additional reporting by Mark Jones and Andy Bruce; Writing by Angus Berwick; Editing by Marguerita Choy