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RAPAPORT... In a move to strengthen financial security and its currency, Venezuela's Central Bank issued a decree to use diamonds, precious metals and other currency deposits to boost its own reserves amid economic uncertainty and falling oil prices. The decree expanded the definition of "reserve currency" to be backed by mineral assets, such as diamonds, and convertible currencies that are deposited in the bank's vaults. The statement did not differentiate whether the precious stones were rough or polished or a combination of the two. The government stated that these off-budget assets would be counted as international reserves and transferred to the National Development Fund (Fonden) where they would be liquid and capable of being rapidly converted into foreign currency. While there are diamond concessions in the country, Venezuela withdrew from the Kimberley Process in 2008 and it hasn't reported diamond production figures since. In March 2009, the government stated it would enact stricter controls over diamond production, mining and industrialization, but reports have surfaced in 2012 and again in 2013 of ongoing diamond smuggling through Brazil and Guyana. Angola, which takes over the chairmanship of the Kimberley Process on January 1, claimed earlier this year that addressing Venezula's participation and compliance issues would be a priority in 2015. In addition, Angola said would address issues related to the Central African Republic (CAR), Cote d'Ivoire and Guinea.
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