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Alex Kimani

Alex Kimani

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Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com. 

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Maduro To Sell Gold To UAE To Stay Solvent

Gold bars

Days after Venezuela’s opposition “president in charge” pleaded with the Bank of England not to cash out Venezuela’s gold reserves, Reuters reports that the country-in-crisis is planning to sell 15 tonnes of gold from its central bank to the UAE, cashing it out for much-needed euros.

That should net Venezuela (or Maduro) over $750 million in euros to add to the three tonnes Reuters says Maduro already sold to UAE last week. The shipment was supposed to go out Thursday night, and another 11 tonnes was said to planned for shipment soon afterwards, according to the unnamed source cited by Reuters.

The UAE is not heeding Washington’s calls for bankers not to cash in Venezuela’s gold, as long as Maduro is selling it. In fact, Washington has threatened the UAE with sanctions over these transactions.

The warning came in the form of a tweet from National Security advisor John Bolton, which referred to commodities “stolen” from the Venezuelan people and advised traders not to make any deals that could be in violation of US sanctions.

Reports also emerged that Maduro was sending gold out of the country on Russian-operated flights, though Moscow denied this at the same time that the Kremlin reminded Maduro that it had debts to pay.

In the meantime, Washington is still combing the world for other assets hidden by the Maduro government. Related: Central Bank Gold Demand At Highest Level In Half A Century

Right now, gold is all Venezuela really has, and according to Reuters, as of November it had 132 tonnes of gold spread out between its central bank and the Bank of England. Its sale suggests severe desperation.

Last week, Washington successfully lobbied the Bank of England not to allow Maduro to withdraw $1.2 billion in gold it is storing there, but the UAE marches to its own tune. And if it is true that the Venezuela’s gold is destined for the UAE, which it authorities have not confirmed, no one knows who might be behind the transaction.

And Washington will have less success lobbying the UAE than it does with the Bank of England.

Turkey, however, is entirely different story. Maduro reportedly sold $900 million in gold to Turkey recently, and Washington is now examining whether these transactions violated sanctions (much like Turkey was complicit in doing the same for Iran).

“We are looking at the nature of Turkish-Venezuelan commercial activity, and if we assess a violation of our sanctions, we will obviously take action,” Reuters quoted a U.S. official as saying.

But Turkey is willing to take the risk. After all, Washington is still considering whether or not to slap sanctions on Turkey’s state-run Halkbank for evading sanctions on Iran in a fictitious gold-trading scheme. So time in on Turkey’s side, and Washington appears more inclined to use these things as future leverage rather than immediate action.

And the chances of it going up against the biggest and best Middle East lobbying force in Washington—the UAE—are slim to none, so Maduro is going to get his cash to help him service debts to Russia and buy a bit more protection from the “president in charge”, opposition leader Juan Guaido.

By Alex Kimani for Safehaven.com

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