The gold could potentially be used as collateral for government loans
A deal regarding Venezuela's gold, valued at approximately $4 billion, is on the table between the Delcy Rodríguez government and the opposition, backed by the US, as the transfer of reserves from the Bank of England to the New York Fed is being considered. Specifically, under the terms of the agreement being discussed, the transitional government of Delcy Rodríguez will acquire legal control of the gold, but will not be permitted to directly sell the reserves, according to four people familiar with the discussions. Instead, the gold could potentially be used as collateral to obtain government loans to fund state spending, including reconstruction after June's devastating double earthquakes, according to three of these individuals. The prospective gold agreement represents one of the first concrete results of a negotiation process between the transitional government and the opposition, supported by the US.
The 7-year dispute
If the agreement is finalized, it will end a 7-year dispute over the gold that began in 2019, when the US, Britain, and several other governments recognized opposition politician Juan Guaidó, then president of the National Assembly, as the legitimate president of the country. Since then, the opposition argued that it controlled the gold bars belonging to the central bank of Venezuela, which were stored in the vaults of the Bank of England. The legal dispute eventually reached the Supreme Court of the UK. The agreement has not yet been finalized, and the process of settling technical details may take a considerable amount of time, according to the same sources.
US and Venezuela relations
A deal on the central bank's gold would mark the latest step in international re-engagement with Venezuela following the US operation in January, during which then-president Nicolás Maduro was arrested. Subsequently, the US lifted some of its sanctions against Venezuela's economy. In April, the IMF resumed official transactions with Venezuela after a seven-year hiatus, allowing the government in Caracas access to funds held at the Fund. Rodríguez, the vice president installed as transitional leader in January, is seeking ways to revive an economy that, even before the earthquake, was growing at a slower pace than anticipated. The negotiation process backed by the US aims to create the conditions for holding new elections in Venezuela. In the last election in 2024, Maduro declared himself the winner, although an independently verified opposition tally showed he had lost by a wide margin. A delegation of opposition politicians is in Caracas this week for talks with a government delegation led by Jorge Rodríguez, current president of the National Assembly.
31 tons of gold in BoE vaults
The government and the opposition announced last month that they are working together to unblock access to the 31 tons of gold held in the vaults of the Bank of England. However, the opposition, which accuses the socialist government of decades of corruption and economic mismanagement, has insisted on enforcing controls to prevent the misuse of the gold reserves. "The gold goes to the US, but Delcy will not have direct access to it," said an opposition figure participating in the talks. "There will be oversight and restrictions." The negotiations over the gold come as the UK and Venezuela agreed this week to upgrade their diplomatic relations. The British government, which will reinstate an ambassador in Caracas, stated that it welcomes the talks regarding holding new elections. Jorge Rodríguez visited London earlier this week for talks with the British government and stated on social media, following his meeting at the Foreign, Commonwealth and Development Office, that there will be "good news" for the people of Venezuela.
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