Wednesday, August 17, 2011
Venezuela Nationalizes Entire Gold Industry
Reuters headlines report that Hugo Chavez, the dictator of Venezuela has announced the nationalization of the entire Venezuelan gold industry.
We have stated here repeatedly that the REAL risk of gold/silver confiscation is that of MINING NATIONALIZATION.
Today's announcement by Venezuela should make that crystal clear.
For those holding Rusoro mining shares you are SOL with a single announcement.
Venezuelan President Hugo Chavez said on Wednesday he will nationalize the gold industry, including extraction and processing, and use its output to boost the country's international reserves.
The move follows a dispute between his government and foreign miners who say the rules limiting the amount of gold that can be exported from the South American nation hurt their efforts to secure financing and create jobs.
Toronto-listed Rusoro, owned by Russia's Agapov family, is the only large gold miner operating in Venezuela. It produced 100,000 ounces last year.
The gold industry will be just the latest part of the economy to be put under state control by the socialist leader, who said he would issue the necessary decree in the coming days and called on the military to help control the sector.
"I have here the laws allowing the state to exploit gold and all related activities ... we are going to nationalize the gold and we are going to convert it, among other things, into international reserves because gold continues to increase in value," Chavez said in a phone call to state television.
The announcement came a day after an opposition legislator revealed a report showing the government's top finance officials were recommending the repatriation of 90 percent of Venezuela's gold reserves held abroad.
The government has not commented on the report, which the opposition legislator said Chavez had yet to approve.
"We've managed to increase the international reserves. We have close to 12 or 13 billion dollars in gold reserves. We can't allow it to continue to be taken away," the president said, referring to reserves held in banks overseas.
Click here for more from Reuters:
Posted by The Doc at 3:59 PM