The gold decree has worked quite well.

On January 25, the Government Electronic Information Portal held a seminar on "Solutions for developing a safe and sustainable gold market".

There is no more "goldenization"

Sharing about the mechanism and policy of gold market management, Prof. Dr. Hoang Van Cuong, National Assembly delegate, member of the National Assembly's Finance and Budget Committee, said that Decree No. 24/2012/ND-CP on gold trading management was issued in 2012. At that time, gold was considered a means of payment, almost using gold instead of money; almost all relationships of great value were converted into gold. We can say that it was the period of "goldenization of the economy".

In that context, the Government issued Decree No. 24/2012/ND-CP to limit the "goldenization" situation with strict regulations such as: The State is the exclusive agency to produce gold bars, the exclusive agency in managing the import and export of raw gold to produce gold bars...

"The Decree was issued very timely and in recent years, the Decree has been quite effective, we have almost corrected the situation of using gold as a transaction tool," said Prof. Dr. Hoang Van Cuong.

Sharing about the model and method of gold market management that is being widely and effectively applied in the world, Mr. Nguyen The Hung, Vice President of the Vietnam Gold Business Association, said that according to international practice, gold is considered a commodity and there are two types of gold: physical gold and non-physical gold. Physical gold includes gold bars, gold pieces, gold coins, jewelry. Non-physical gold includes gold accounts and gold certificates traded on the market.

In Vietnam, gold bars are chosen as a national brand and the State has exclusive rights to produce and trade them. People consider gold as a means of saving and preventing inflation and risks. Currently, the value of Vietnamese currency is very stable, the exchange rate is also very stable. Therefore, people do not use gold as a means of payment and there is no longer a situation of "goldenization".

Sharing the same opinion, Prof. Dr. Hoang Van Cuong said that the psychology of Vietnamese people from the past to the present is that hoarding gold is to ensure safety and avoid risks. In the context of people needing to accumulate, SJC gold is identified as a national brand gold, so of course people will choose the most reliable gold.

“Although SJC and other gold bars may have the same quality, this is a national brand gold, so of course it is trusted. Accumulation is always the safest, so people want to buy, accumulate, and own SJC gold. While there is no supply but there is real demand, it will naturally lead to an imbalance between supply and demand and the price of gold will increase,” shared Prof. Dr. Hoang Van Cuong.

Faced with the complex and unpredictable developments of the international and domestic gold markets, the State Bank of Vietnam (SBV) has issued many recommendations for people to be cautious in gold transactions. At the same time, in January 2024, the SBV will submit a summary report on Decree 24, including proposals to amend and supplement a number of regulations on gold market management to suit the new context of the market. The SBV has also issued consecutive documents requesting the Ministry of Finance, the Ministry of Industry and Trade and the Ministry of Public Security to coordinate in gold market management.

Guests attending the Discussion (Photo: VGP)

Good management, ensuring people's interests

However, compared to the time of promulgation of Decree No. 24/2012/ND-CP, the situation has changed a lot. There have been many changes in the macro economy, financial relations, currency, international relations, etc. When the context changes, according to experts, it is necessary for the management agency to study a new mechanism for this policy and this is the right time to re-evaluate the goals and policies for managing the gold market.

Prof. Dr. Hoang Van Cuong proposed that when the supply is free and there is equal competition, people will have easier access to gold and there will be no more scarcity because the mentality is that the more scarce, the higher the price, the more people buy. Meanwhile, the current trading trend in the world is to open up business methods on the trading floor through business contracts, through gold credits. If these forms of business are opened, the market will not be too dependent on the amount of import, and the supply and demand will be balanced immediately; gold circulating on the market will generate profits, create capital for circulation, bring many positive impacts to the economy as well as ensure the interests of each person.

Also hoping for a change in thinking about how to manage the gold market, Prof. Dr. Tran Tho Dat - Chairman of the Science and Training Council, National Economics University said that the regulatory agency needs to research and develop a strategy for the gold market as an organic part of the financial market, integrated and connected with the world; it is necessary to research and allow commodity exchanges to trade gold through futures and options contracts. Participating members must meet strict standards. Along with that is the establishment of a gold trust fund to promote its role as a stabilization fund, contributing to stabilizing the macro economy.

In addition to the policy mechanism, Mr. Nguyen Viet Anh, Deputy General Director of Tien Phong Commercial Joint Stock Bank (TP Bank) said that to manage gold prices, it is necessary to manage people's psychology before gold price fluctuations. Because in reality, the gold market has recently been affected by factors such as psychology... Therefore, people should not rush to follow strong fluctuations in gold prices. Because in reality, gold prices increased sharply, people bought a lot of gold, pushing up prices, but only after the Prime Minister's telegram, gold prices immediately decreased...

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