Venezuela Nears Deal to Move $4 Billion in Gold to New York Fed

Venezuela’s government and opposition are nearing an agreement to transfer roughly $4 billion worth of the country’s gold reserves from the Bank of England to the Federal Reserve Bank of New York, potentially ending a years-long dispute over control of the assets.

Under the proposed arrangement, the interim government led by Delcy Rodríguez would receive legal control of the Venezuelan gold reserves. However, authorities would face restrictions preventing them from immediately selling the bullion, according to the Financial Times, which cited four people familiar with the negotiations.

Instead, Venezuela could use the gold as collateral to secure government borrowing. The financing could support public spending and reconstruction projects following the devastating double earthquake that struck the country in June. The recovery effort has become a major financial challenge for Caracas as it seeks access to assets held overseas.

The potential agreement represents a significant development in negotiations between Rodríguez’s government and sections of Venezuela’s opposition. The two sides previously agreed to cooperate in seeking the recovery of international reserve assets held at the Bank of England.

A final deal would also help resolve a prolonged legal battle surrounding Venezuela’s gold reserves in London. The dispute dates back to the political crisis that intensified in 2019, when the United States, United Kingdom and several other governments recognized opposition leader Juan Guaidó, then head of Venezuela’s National Assembly, rather than Nicolás Maduro as the country’s legitimate president.

That recognition complicated control of Venezuelan assets held abroad and triggered litigation over who had authority to access the bullion stored at the Bank of England.

The UK government said earlier this month that it is not a party to the legal proceedings determining control of the Venezuelan gold, emphasizing that British courts and the Bank of England operate independently of the government.

While negotiations appear advanced, final details remain under discussion, including legal arrangements governing the transfer and future use of the gold.