Early adjustment of gold market management policy

On May 10, the price of SJC gold bars continuously broke the peak. As of 2:00 p.m., Saigon Jewelry Company (SJC) had increased by 2.7 million VND per tael of gold bars in both buying and selling directions compared to the previous session's close, listed at 89.9 - 92.2 million VND/tael. Other gold trading enterprises also sharply increased the price of SJC gold by 2.2 to 3.1 million VND/tael.

Người dân giao dịch mua-bán vàng. — People trade gold.

At the same time, the world spot gold price was commonly around 2,364 USD/ounce. Thus, after a strong increase of nearly 41 USD/ounce the previous day, the world gold price in the current Asian session also continued to increase by more than 18 USD/ounce. Converted according to the exchange rate listed at Vietcombank, the world gold price is equivalent to 72.6 million VND/tael (excluding taxes and related fees). The gap between domestic and world gold prices continues to widen to nearly 20 million VND/tael.

Along with the dizzying “dancing” of gold prices, the situation of people lining up to buy and sell gold at stores has recurred. Such developments have made many people question the effectiveness of the State Bank of Vietnam’s auction, when the gap between domestic and international gold prices has not only narrowed but also increased.

Economist, Dr. Le Xuan Nghia frankly stated his opinion that the recent gold auction has not effectively reduced the price of gold, and has even triggered a price increase psychology. Domestic gold prices have continued to increase in recent days, the gap with international gold continues to widen, which means there has been no change in supply.

At the same time, this expert also pointed out that the State Bank of Vietnam's purpose is to reduce the price of gold. But to do this, the bidding price must be low, while in reality, the reference price offered by the State Bank of Vietnam is too high.

Người dân xếp hàng chờ giao dịch vàng. — People line up to trade gold.

Therefore, Dr. Le Xuan Nghia believes that gold auctions are not a measure to increase supply. The most important thing to increase supply is to allow gold businesses to import and export gold, and the State controls it through taxes.

"In this way, immediately within 1 week, domestic and world gold prices will be connected. Because gold and silver businesses importing gold from Singapore, Hong Kong (China), Thailand, etc. will arrive very quickly," Mr. Nghia affirmed.

Sharing the same view, many economic experts also see that the State Bank of Vietnam organizing auctions is only a temporary solution. What needs to be done in the long term is to amend Decree 24/2012/ND-CP dated April 3, 2012 of the Government on the management of gold trading activities. Certainly, if the Decree is amended, the gold supply will increase, enough to meet market demand.

Associate Professor, Dr. Dinh Trong Thinh also stated that up to now, Vietnam has only imposed taxes on businesses and gold shops, mainly based on self-declared data and difficult to control. From his experience in the petroleum business, Mr. Thinh suggested that gold purchases and sales should be required to issue invoices. For those who do business with revenue and income, they must pay taxes, which will limit gold speculation.

“To make the gold market more transparent, it is necessary to immediately apply the issuance of invoices when buying and selling gold. This will help management agencies better grasp the supply and demand in the market, the origin of gold and limit speculation,” Associate Professor, Dr. Dinh Trong Thinh emphasized.

Economist, Dr. Nguyen Tri Hieu further suggested that the State Bank of Vietnam should assign the gold import to reputable gold traders and withdraw to the role of management, not the gold importer. Along with the imposition on each gold trader, the State Bank of Vietnam will still control the amount of foreign currency spent to buy gold. This will create a more abundant and stable supply in the market.

nhandan.vn

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