Portugal’s gold reserves are worth some $17.5 billion, and rising due to the spike in gold prices. KGS
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Portugal urged to sell gold to escape debt crisis
BERLIN (Commodity Online) : Debt ridden Portugal could help itself by selling from its gold reserves before appealing for any more help from the European Union, according to German law makers.
German MP’s include Norbert Barthle, governing coalition budget speaker Carsten Schneider from the Social Democrats, the biggest opposition party and Frank Schäffler, a member of the pro-business FDP liberal party urged Portugal to consider selling some of its gold reserves to ease its debt problems.
They called for a review of Portugal’s request for financial aid to include gold and other potential asset sales.
The German lawmakers did not specify who should buy the gold from the Portuguese central bank but given the challenges facing Germany and the Eurozone, it is likely that the Bundesbank and the ECB would be willing buyers if the gold is not already encumbered due to Portugal’s membership of the Eurozone.
IMF chief Dominique Strauss-Kahn and EU Economy Commissioner Olli Rehn warned on Thursday that the Portuguese people would have to deliver “truly national” and “major” reform efforts in exchange for $116 billion bailout which has just been agreed.