Venezuela Moves To Return Its Gold

As the price of gold increases in the world markets

, one country that has taken a bold move regarding this precious metal is Venezuela. Under orders from its government, Venezuela has decided to return its gold deposits currently housed overseas back to the country.

This economic decision has been rooted on the ever-increasing value of the rare element compared to many former blue chip currencies and the continued spiraling increase in the cost of oil. Another factor is the continued doldrums of the European Union and its debt crises, making gold deposits in London and other European countries very worrisome.

According to the Venezuelan Finance Minister, Nelson Merantes, the gold returned to the country is not only valuable but also has "historic value and symbolic value." The gold was said to have returned to the country amidst wild celebrations with a convoy leading the bullion to vaults in the capital city.

He added, "Each box of gold weighs 500 kilograms and is worth about $30 million. We'll bring the rest back little by little."

The decision was reached to allow the country financial autonomy and be protected from pressure of foreign governments and economies. The move was precipitated by the Venezuelan president, Hugo Chavez, going on national television flanked by the Council of Ministers, the Executive Cabinet and the representatives of the country's Central Bank. The move, the president said, was to return the country's body and soul and give the country independence from what he termed as imperialist powers. He further added that the act was a sovereign step and said the Venezuelan Central Bank would be carrying out the mission.

According to the newly independent Central Bank, the country said that it had gold reserves with the Bank of England, JP Morgan Chase and Co, Barclays PLC and Standard Chartered PLC aside from other banks. The new cash reserves would be placed in financial institutions such as Russia, China and Brazil.

Critics have called the move as Chavez's way to amass a war chest for the next elections. Some say that the gold would be given to Cuba as gratitude for the medical efforts in saving his life from cancer. The greater majority though believes in the move to assist Venezuela become more financially independent as the gold reserves do not earn interest in England and it even costs the government more with the arrangement. The move though may have been taken to avoid the freezing and seizure of assets found overseas from fallen strongmen, the latest being the late Col Moammar Gadhafy.

by: Bobby Castro

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