The bullion market is stepping into a new
age. In early April, 2012 the Government rubber-stamped Decree 24/2012/ND-CP
effective from May 25, 2012, regulating gold management.
Accordingly,
local businesses qualified to trade bullion must have a chartered capital of
VND100 billion ($4.7 million) or higher, at least two years’ experience in gold
trading activities, annual taxes paid on gold trading of more than VND500 million
($23,800) in the last two years and a gold trading network in at least three
centrally-governed provinces or cities.
Head of
State Bank’s Foreign Exchange Management Department Nguyen Quang Huy said
unqualified bullion traders would have at least six months to make themselves
conform with Decree 24 regulations.
Decree
24 got plaudits from economic experts and businesses.
Former
head of State Bank’s Foreign Exchange Management Department Phi Dang Minh said
a state monopoly in gold management was necessary.
But,
gold traders expressed concerns the new decree did not contain clear
regulations on account-based gold trading.
“Under
Decree 24, account-based gold trading is subject to prime minister’s approval.
Restricting physical gold is the right move, but we need to open a channel for
non-physical gold trading which will be controlled by the state to abate risk,”
said Vietnam Gold Business Association general secretary Dinh Nho Bang.
Le Tham
Duong from Ho Chi Minh City University of Banking said the gap in domestic and
world market gold prices could not be effectively tackled if the government did
not green-light account-based gold trading.
Industry
experts said a level playing field was necessary to mobilise idle gold from the
community.
A bank
executive forecast that 30 banks and five major gold trading firms would be
green-lighted to come up with account-based gold trading in foreign markets to
minimise risks whereas local people would still be ineligible to perform the
service.
Central
bank governor once said the State Bank would continue putting a cap on
account-based trading in the coming period since this service in fact just
entailed profit to a small business group.
Senior
economist Le Dang Doanh suggested creating a ‘marketplace’ to promote gold
certificate transactions which would be regulated in the upcoming plan to
mobilise gold from the community.
Ha Tam
| vir.com.vn
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