Resolute solutions to soon stabilize the gold market

In less than a year, the Government has issued many documents directing and urging the management of the gold market. Most recently, on April 11, 2024, the Government Office issued Notice No. 160, the Prime Minister's conclusion at the meeting on solutions for managing the gold market in the coming time, with more specific instructions and more drastic and synchronous solutions.

Quyết liệt các giải pháp để sớm bình ổn thị trường vàng

Hopefully, with the strong actions of the Government and the State Bank, in the coming time, the domestic gold market will be stable, harmonizing the interests of all parties. Illustrative photo

According to experts, in the market mechanism, the fluctuation of gold prices is normal, but if there is no timely solution to handle the fluctuations in gold prices, it will affect the recovery and development of the economy, and the major balances of the macro economy. In Vietnam, the State has a monopoly on gold trading, so the price of gold is affected by the international market. Since 2012, with the regulatory tool of Decree 24/2012/ND-CP of the Government, the gold market has been strictly managed, preventing the "goldenization" of the economy. The State Bank does not put more gold on the market, SJC becomes the State's monopoly gold while the supply is not abundant, so even a slight fluctuation, businesses hoarding, speculating or just due to psychological factors can cause the price of gold to increase.

The scarcity of supply, the increase in domestic gold prices, and the large difference with world prices have led to an increase in gold smuggling. While the domestic gold market has been closed, the three countries bordering Vietnam, Laos, Cambodia, and China, have all opened their gold markets. For many years, gold smuggling, especially in the southwestern border provinces and the central region bordering Laos, has been on the rise, with many cases involving extremely large quantities, with the assistance of anti-smuggling forces and flight attendants.

In June 2023, functional units of the Ministry of Public Security and Quang Tri Provincial Police investigated and dismantled a huge cross-border gold smuggling ring led by Nguyen Thi Hoa (residing in Quang Tri province). Within just 1 year, the subjects smuggled over 3 tons of gold, with a total value of about 5,000 billion VND from Laos to Vietnam through Lao Bao border gate (Quang Tri province), and sold it to gold shops in Vietnam to make illegal profits...

Gold smuggling cases have been uncovered repeatedly, but that is only the tip of the iceberg. Faced with the complicated developments of the world and domestic gold markets, domestic gold prices have fluctuated strongly, increased rapidly and have a high difference compared to international prices, the Prime Minister has issued many drastic instructions. The State Bank has also been preparing intervention plans to stabilize the gold market.

It is known that this April, the State Bank has established an interdisciplinary inspection team to inspect the gold trading activities of enterprises and credit institutions nationwide in 2022 and 2023. Hopefully, with the strong actions of the Government and the State Bank, the shortcomings and violations of organizations and individuals will be clarified, overcome and handled so that the gold market will soon return to normal.

Gold is an extremely sensitive asset, closely linked to exchange rates, interest rates, the currency market, foreign exchange, and national financial and monetary security and safety. Therefore, it is necessary to strictly implement the Prime Minister's direction and the State Bank to urgently review and develop a Decree amending, supplementing or replacing Decree No. 24/2012/ND-CP to develop a stable, healthy, transparent, effective and sustainable gold market, avoiding the goldification of the economy.

At the same time, there are anti-monopoly solutions, both managing the gold market and harmonizing the interests of all parties. It is necessary to immediately handle the difference in domestic and international gold bar prices, especially to prevent smuggling and not to let profiteering, speculation, manipulation, and price hikes happen. The relevant agencies need to encourage the gold jewelry industry to export to balance foreign currency sources and increase foreign exchange reserves in gold to increase the ability to stabilize the gold market...

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