UK Court Supports Guaido, Not Maduro, Saying "Gold Withdrawal Not Allowed"

President Nicolas Maduro [Photo by AP]

Juan Guaid? Speaker of the National Assembly [Photo by Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] A UK court has rejected Venezuelan President Nicolas Maduro's demand to return approximately $1 billion worth of gold entrusted to the Bank of England (BOE) by the Venezuelan government. The court ruled that, according to the Venezuelan constitution, the president is not Maduro but opposition leader Juan Guaid?, the Speaker of the National Assembly.

On the 2nd (local time), according to BBC and others, the High Court of England and Wales made this announcement regarding the lawsuit filed by the Central Bank of Venezuela against the Bank of England (BOE) to return the gold held in custody. The court stated, "The UK government recognizes Guaid? as the constitutional interim president of Venezuela," adding, "Therefore, it does not recognize Maduro as the constitutional president."

As a result, it has become practically difficult for the Central Bank of Venezuela to withdraw the requested gold. The BOE currently holds 400,000 gold bars worth approximately ?200 billion, making it the second-largest gold custodian in the world after the Federal Reserve Bank of New York. Venezuela had entrusted about $1 billion worth of gold to the BOE for safekeeping.

Under the Maduro administration, the governor of the Central Bank of Venezuela expressed the intention to withdraw gold from the BOE in 2018, but the BOE responded that it could not authorize the withdrawal due to "authority issues." Although President Maduro was re-elected in May 2018, the opposition strongly opposed the election as fraudulent, and the US and UK refused to recognize the election results. The UK government recognized opposition leader Guaid? as the interim president of Venezuela after he declared himself as such the following year.

In this context, President Maduro again requested the BOE to release the gold, citing the need for funds to respond to COVID-19, while Guaid? asked the BOE not to hand over the gold, arguing it would be used for corrupt purposes. The BOE requested the UK High Court to determine whom the UK government recognizes as the president of Venezuela, and this was the outcome announced on the day.

The Maduro administration announced it would appeal the UK court's decision. A representative of the Central Bank of Venezuela emphasized, "This ruling completely ignores the actual situation on the ground," adding, "The Maduro administration fully controls Venezuela and its administrative institutions. This outcome will cause harm to the Venezuelan people whose lives are at risk by delaying the issue."

One foreign media outlet noted that the UK government has accepted Rosio Maneiro, the ambassador sent by the Maduro government, and operates the British embassy in Caracas, the capital of Venezuela, indicating that while recognizing Guaid? as the head of state, it has continued diplomatic relations with the Maduro government.