A customer buys gold at Bao TIn Minh Chau Gold Firm in Ha Noi. Viet Nam Gold Trading Association (VGTA) has proposed the establishment of a national gold exchange. — VNA/VNS Photo Danh Lam
The Viet Nam Gold Trading Association (VGTA) has proposed the establishment of a national gold exchange in Ha Noi or HCM City.
The move aims to create a link between domestic gold prices and international gold prices, VGTA said.
This will help eliminate illegal gold trading floors, increase the mobilisation of gold from the people, reduce cash transactions and prevent tax losses to the State.
At a recent Executive Board meeting of VGTA, the association made other recommendations to renew legal policies as well as management mechanisms for the gold industry.
It proposed that the Government and the National Assembly remove gold jewellery and fine arts production from the list of conditional business lines, as well as to consider licencing certificates for gold businesses, allowing them to import gold material to ensure they have enough raw materials for production.
According to the VGTA, many provisions in Decree 24/2012/ND-CP on gold trade management are no longer suitable today as Viet Nam's gold market has basically stabilised.
A number of new laws on investment and business were enacted in the direction of international integration since the decree was created almost a decade ago, the VGTA said.
The VGTA also proposed abolishing the regulation that the State Bank monopolises the production of gold bars, and does not use SJC gold bar as an exclusive brand name as at present. It reasoned that allowing a number of businesses to produce gold bars would help create fair and equal competition in the market, creating advantages for customers when buying gold.
Previously, at the end of 2020, the VGTA made the same recommendations. Regarding this issue, Deputy Governor of the State Bank of Vietnam Dao Minh Tu said the State Bank's viewpoint is consistent with the policies and the results achieved in recent years, saying Decree 24/ND-CP is still applicable.
Tu said, since Decree 24 came into force, it had brought many benefits to both the micro and macro-economy. In the domestic market, gold prices in recent years no longer fluctuate greatly and don't affect commodity prices and exchange rates.
When commodity prices and exchange rates do not fluctuate too strongly, it will create conditions for stable development of the macro-economy.
"Gold bars and raw gold are not ordinary goods so they need to be managed carefully,” Tu said.
According to Nguyen Hoang Hai, Vice Chairman of Vietnam Association of Financial Investors (VAFI), in 2008 and 2009, there were many gold trading floors, whose operation did not bring significant benefits to the economy.
Instead, they disrupted the money market, bringing disadvantages because many companies providing gold trading services attracted participants to trade in the form of gambling, leading to massive losses.
Sharing the same idea, Tu said due to its complex nature and the risks of gold being freely traded on the exchange, Decree 24 of the Government was born to effectively manage the trade of gold on the market.
"We will acknowledge and thoroughly study the proposal of the Viet Nam Gold Trading Association. But first of all, the macro interests and common interests of all people must be put first, then the benefits of the gold businesses will be taken into account,” he said.
The Saigon Gold and Jewelry Company listed each tael of SJC gold at VND55.35 million -VND55.72 million (buying-selling), a drop of VND30,000 compared to the rates on Tuesday.
Bao Tin Minh Chau Gold Firm in Ha Noi also decreased rates per tael to VND55.36 million and VND55.66 million (buying-selling) compared to those on Tuesday.
At the same time, on the global gold exchange Kitco, prices fell $0.1 per ounce to close at $ $1.778,01 per ounce.— VNS