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Photo: EPA. The loss of international recognition has made it difficult for the Maduro government to access international loans and even to manage Venezuela’s resources abroad.

EPA The loss of international recognition has made it difficult for the Maduro government to access international loans and even to manage Venezuela’s resources abroad.

The Central Bank of Venezuela (BCV) went to court in London to try to recover $ 1 billion of gold bullion from its international reserves held in custody at the Bank of England.

The Venezuelan authorities assure that they require these resources to face the crisis caused by the coronavirus pandemic in that country, which until this Tuesday had officially registered 749 infections and 10 deaths, the lowest figure in Latin America next to Costa Rica, according to data collection from Johns Hopkins University.

The lawsuit was filed on May 14, a few weeks after the Venezuelan authorities unsuccessfully requested to sell part of that gold and transfer the resources to the United Nations Development Program (UNDP).

Now, the BCV is requiring the transfer as an “urgent matter” to acquire food and medicine.

The Venezuelan economy is going through some of its most difficult moments after the economic crisis that it has suffered for years – characterized by hyperinflation, serious shortage problems and the virtual paralysis of much of the productive apparatus – was joined by the collapse of the industry oil and economic sanctions imposed by the United States government.

In this context, selling gold reserves has become one of the strategies applied by the government of President Nicolás Maduro to obtain liquidity.

However, the president has not been able to gain control of some 31 tons of Venezuelan gold bars found in the vaults of the Bank of England.

A recognition problem

Since January 2019, when his second term began, Maduro ceased to be recognized as the legitimate president of Venezuela by more than fifty countries, including all members of the European Union and the United Kingdom.

Those governments consider the 2018 presidential elections “fraudulent” and, instead, they recognize as “interim president” of the country, the head of the National Assembly, the opposition deputy Juan Guaidó.

For his part, Maduro denounces an international compromise to remove him from power.

That lack of international recognition prevented the IMF from considering a attempt to ask financial assistance presented by the Maduro government a few months ago and is also the basis for the Bank of England’s refusal to free up those resources.

This position is strongly criticized by the Venezuelan government.

“With lives at stake, this is not the time to try to score political points,” Sarosh Zaiwalla, a lawyer representing the BCV in London, said in a statement.

According to the Venezuelan authorities, the idea is that the resources are administered by the UN.

In an email sent to the BBC, that organization only indicated that it had been contacted by the Venezuelan issuing entity to explore that mechanism.

For its part, the Bank of England, which usually acts as custodian of the international reserves of several developing countries, preferred not to comment on this issue, when asked by ..


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