The annual accounts by the World Gold Council, released every January, show Portugal has more gold than wealthier nations such as the United Kingdom, Saudi Arabia and Spain.
Current reserves in the country are calculated at 383 tonnes, which is worth 12.1 billion euros in current market prices of the precious commodity.
On the World Council’s list, Portugal is 13th among nations, but placed 15th, as the ranking includes the reserves held by the International Monetary Fund and the European Central Bank.
The biggest gold reserves continue to be held by the United States, with more than 8,134 tonnes of bullion held at depositories such as Fort Knox.
Germany comes a distant second with 3,381 tonnes, followed by the IMF with 2,814 tonnes.
Portugal, in terms of monetary reserves, has the fourth highest ratio of gold reserves, standing at just over 68 percent, though down on the 2015 figure of 75.3 percent.
However, the value of gold has dropped since the peak of the crisis, with Portugal’s gold reserves, which have remained unchanged since 2012, worth 16 billion euros.
Back then, many analysts called for Portugal to ease the burden the bailout has had on Portugal, saying the country should be given the go-ahead to delve into these stocks, but only to give them up as a guarantee at substantially lower interest rates being charged by the EU’s major shareholders and the IMF.
The World Gold Council (WGC) has suggested that the European Parliament pushes for Portugal to be allowed to offer gold as collateral for sovereign debt issuance.
“Portugal has gold reserves in excess of 20 percent of its financing requirements over the next two years”, the World Gold Council said in a report based on research done on its behalf by the London-based group, Europe Economics.
Portugal’s gold is not the collective property of the Euro Zone and is the sole beneficiary of the gold held at the Bank of Portugal in Lisbon.
The WGC stressed at the time that money (euros) “is abstract – numbers on a computer screen. By contrast, gold is concrete. Gold bars might sit in a warehouse or a vault. Creditors could go see them.”
While it stressed that monetary actions raise considerable issues of reliability, “the concreteness and simplicity of gold as collateral makes it more credible.
“Physical gold bars could be transferred to a third party location (e.g. London). The Portuguese government would get them back when their debts were redeemed and would not get them back if they defaulted. It is difficult to see how a policy could be more credible”, the European Economics report argued.
Despite the substantial quantity of gold held by the Bank of Portugal on behalf of its citizens, the last occasion its gold was touched was in September 2006, when 20 tonnes were sold off. Despite its gold vault being closed for business over the past six years, Portugal’s gold reserves have halved since 1975.
Nonetheless, Portugal’s reserves represent the highest proportion of GDP (9.49 percent) in the developed world, and when including all nations, is only behind Lebanon which stands at 10.32 percent.