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7.4 Tons of Venezuelan Gold “Lost” in Africa

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7.4 Tons of Venezuelan Gold “Lost” in Africa

By John McDonald

Venezuela was once one of Latin America’s most prosperous countries. Today, it is foundering in an ongoing economic and political crisis. 

To make matters worse, it appears to have recently “lost” more than 7 tons of gold valued at more than $300 million.

Here’s what we know happened so far:

Venezuelan President Nicolás Maduro has been selling off the country’s gold reserves in an attempt to raise hard currency. The country has been largely isolated by U.S.-led sanctions that eliminated much of its oil revenues due to its participation in what the current administration has labeled a “troika of tyranny.” 

The administration hopes to oust Maduro from power in the OPEC nation when his presence means the government can no longer pay for imports of basic goods. 

This policy has been highly controversial. The U.S. State Department maintains Maduro is simply conducting a “fire sale of Venezuelan resources” in the wake of a sham reelection. 

Critics of the policy say it simply exacerbates the ongoing crisis in the country. Maduro responded to sanctions and criticism by preventing humanitarian aid from entering his country and severing ties with the United States. 

The situation in Venezuela has been deteriorating since Maduro took power in 2013.

This brings us to the present day, when the Venezuelan government sent about 7.4 tons of gold via two separate airline flights to a refinery in Uganda. The shipments arrived in Entebbe on a Russian charter jetliner with a flight record originating in Caracas, Venezuela. 

According to Ugandan police, the gold was processed in the African Gold Refinery Ltd. near the runway, then exported to the Middle East with a final listed destination of Turkey. 

However, it is unclear where the gold actually went after leaving Uganda, which is crucial if Maduro wants to continue successfully selling off his country’s precious metals reserves. If buyers can identify Venezuelan gold as such, they are less likely to buy it because international powers are strongly discouraging such activities.

“My advice to bankers, brokers, traders, facilitators, and other businesses: Don’t deal in gold, oil, or other Venezuelan commodities being stolen from the Venezuelan people by the Maduro mafia,” tweeted national security advisor John Bolton recently. In order for Maduro to sell off the gold, even at a discount, it will be important for it to be largely unidentifiable.

This is likely why it went through the refinery before being shipped onward: Gold is nearly impossible to trace to origin once it has been refined.

Gold Could Save Your Life in Venezuela

Always a safe-haven investment in times of any type of turmoil, gold takes on new significance in Venezuela, where it could literally save your life. In fact, in August 2018, analysts speculated that inside Venezuela, gold would likely be the only currency accepted when families attempted to leave the country. 

Some estimated indicated at that time that nearly 4 million people had already fled, and the price for a seat on the single flight to the United States still running at that time could probably only have been paid by someone owning gold. After all, a cup of coffee had ballooned in value by 87,000 percent.

For an example of how gold performs under pressure that is a little less extreme and a little closer to home, look to how gold performed over the last weekend in June 2019. 

During the G-20 Summit the preceding week, rumors were rampant that the U.S. might either resume attempts to strike a trade deal with China or, on the other extreme end, seriously deteriorate current international relations. 

In response, gold closed high on Friday (as did other precious metals) and opened high the following Monday as well.


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