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Gold in London bank sparks battle between Venezuelan rivals

by Ace Damon
Gold in London bank sparks battle between Venezuelan rivals

CARACAS, Venezuela (AP) – The political battle for control of Venezuela has turned into a $ 1.8 billion pile of gold bars, located in the Bank of England safe in London, where a judge is expected to rule on soon who has the legitimate claim to gold.

Venezuelan President Nicolás Maduro says he needs gold to help his hungry country fight the coronavirus pandemic. But the UK’s central bank, whose government recognizes Venezuelan opposition leader Juan Guaidó as its country’s legitimate leader, refused to hand him over to Maduro’s socialist administration.

A decision by Judge Nigel Teare, due in a few days’ time, may help to clarify the question of who is Venezuela’s legitimate leader – at least in the eyes of a world power, experts say.

“If Maduro is able to get his hands on that money, it weakens a significant tool that the British government has in place to implement its Guaidó recognition,” said Michael Camilleri, a Venezuela expert at the Washington Inter-American Dialogue think tank. “It undermines the strength of that policy.”

The dispute depends on the British position in relation to Venezuela, a country in economic and political crisis where Maduro and Guaidó have been claiming presidential powers for more than a year.

The United Kingdom recognizes the claim of Guaidó, who heads Venezuela’s congress, as does the United States and about five dozen other governments. Guaidó proclaimed himself interim president in early 2019, months after Maduro declared victory in an election that his critics say was rigged in his favor.

England’s Foreign Secretary Jeremy Hunt recognized Guaidó as interim constitutional president, and Guaidó met with Prime Minister Boris Johnson earlier this year during a tour of Europe.

Despite support for Guaidó, the United Kingdom continues to maintain diplomatic ties with the Maduro government. Maduro’s ambassador, Rocío Maneiro, is recognized by the British government and controls the Venezuelan embassy in London, while British ambassador Andrew Soper remains in Caracas.

At the same time, the British did not grant diplomatic credentials to the envoy Guaidó appointed ambassador to the United Kingdom.

While Guaidó launched his campaign to expel Maduro with thousands of fans cheering the streets of Venezuela, the socialist president maintained control over most branches of the Venezuelan government, including the military. Meanwhile, enthusiasm for Guaidó is fading.

Leigh Crestohl, a lawyer representing the government of the Central Bank of Venezuela appointed by Maduro, said the Venezuelan leader clearly has control of the country, giving him the right to receive the gold.

“If a government is in fact in control of a territory, and this is recognized by maintaining full and normal diplomatic relations, this should be treated as formal recognition,” said Crestohl in a statement. “In our case, the law is clear.”

Guaidó is asking the London court to order the Bank of England to hold the gold and not hand it over to Maduro’s government, which he considers illegitimate and corrupt. His lawyers reiterated during a recent four-day hearing the argument that the leader of the National Assembly became Venezuela’s legitimate leader under the provisions of the country’s constitution. They considered the continuing diplomatic ties between London and Maduro to be irrelevant.

Venezuela was once one of the richest nations in Latin America, at the top of the largest oil reserves in the world. Critics of the socialist government blame corruption and mismanagement for destroying its oil industry and the large economy.

Maduro blames the country’s ills for what he says is an economic war led by the United States, and he accuses Washington of imposing crippling sanctions in an attempt to dominate Venezuela, blocking its ability to sell Venezuelan oil. He has the international support of countries like China, Russia, Cuba, Iran and Turkey.

Maduro is looking for a large share of the gold that Venezuela holds at the Bank of England. He asked for access to gold before the coronavirus outbreak and recently renewed the request, saying his government would channel money from the sale of gold through a United Nations arm just to fight the pandemic in Venezuela.

Camilleri, an analyst in Washington, said there was widespread skepticism about Maduro’s alleged plan to use gold.

“Maduro was trying to get that money before coming back with the new claim that it was for relief from COVID-19,” said Camilleri.

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