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Recently, De Nederlandsche Bank moved approximately 86 tonnes of gold from the US and Canada to London, but why not to the Netherlands? Paul Buitink, Managing Director of Holland Gold, discussed this with Wilfred Genee on BNR’s The Friday Move.
Officially, this was done to improve the tradability of the gold and strengthen crisis preparedness. Buitink also views the move in light of geopolitical tensions with the US. But why is this portion of our gold being held outside the EU rather than in the Netherlands itself?
Buitink has long been calling for a review of De Nederlandsche Bank’s diversification policy. The point is that the Netherlands, with total gold reserves of 612.5 tonnes (± €74 billion), stores its gold at several different locations. This geographical diversification makes sense, but given the changing geopolitical relationships, the question is whether the choice of the United States or Canada is still as safe as it once was.
“DNB will not directly say that it is because of Trump, of course,” Buitink says, putting the issue into perspective. In London, one of the world’s largest gold trading centres, gold can theoretically be traded more easily. Before the operation, 18.1% of our gold reserves were already held in London; following the move, that share has increased to 32.1%. So why was this gold not moved to the Netherlands or Switzerland?
The operation also involved costs, as it was not solely a matter of direct physical transport. The gold held in the United States and Canada did not meet the latest international standards. Almost 59 tonnes of gold were sold in New York, after which gold meeting international trading standards was purchased in London. DNB has not disclosed the costs associated with this exchange. “A sharp Member of Parliament should also want to ask DNB for that information,” Buitink suggests.
Watch the full interview on BNR’s YouTube channel: De Nederlandsche Bank removes gold from the United States and Canada as confidence in America declines.
