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Interview with SBV Foreign Exchange Director General on gold trading management
In regard of Decree No. 24/2012/NĐ-CP dated April 3, 2012 on gold trading management, the Director General of the Foreign Exchange Department of the State Bank of Vietnam (SBV), Mr. Nguyen Quang Huy, has granted an interview on the gold trading management. Following is the full text of the interview.
Question : The market has paid lip service to a rumor that those entities and individuals in possession of non-SJC (Saigon Jewelry Company) gold bars have encountered problems in trading or converting them into SJC gold bars. Could you make comments on this rumor ?
Answer : As stipulated in Item 2 of Article 3 of Decree No. 24/2012/ND-CP on gold trading management, "gold bar" means gold moulded into ingots, and stamped with the figures indicating weight, quality and trademark of the enterprises and credit institutions licensed by the SBV for the production of gold bars from time to time. Also, Item 1 of Article 4 of Decree No. 24 states: "The legal ownership of gold by entities and individuals are acknowledged and protected in accordance with law." Accordingly, Decree No. 24 doesn’t impose discrimination between gold bars of SJC and other companies. All gold bars produced by SJC and other companies in legal possession by entities and individuals are recognized, protected, traded or exchanged at the licensed credit institutions and enterprises in the post-transitional period as set by the SBV.
Therefore, the public should stay calm and cautious in face of misled information about gold bars in order to avoid unnecessary losses.
Q : Decree No.24 specifies strict conditions for enterprises to obtain a gold bar trading license. Consequently, the number of eligible enterprises will be much smaller as compared to the present time. Does this new decree lead to the unexpected closure of many gold trading shops?
A: SBV has posted on its website the draft circular on implementing guidelines of Decree No. 24 for comments and inputs, including the transitional period and procedures for those entities and credit institutions currently engaged in gold bar trading. As expected, the transitional period will be at least 6 months. Therefore, they will continue trading gold bars in at least7.5 months (as of the issuing date of Decree 24) and will have enough time to apply for new licenses to trade gold bars, or to get prepared to become jewelry shops as stipulated in the Decree.
Q : Do you think that the reduced number of gold bar trading enterprises will seriously affect the gold bar trading demand of people?
A: The gold bar trading demand of the people will be met through the network of trading points not only of enterprises, but also of credit institutions. The licensed enterprises may open new branches to meet the needs of people. The gold bar trading points of credit institutions has currently numbered thousands. SBV has directed enterprises and credit institutions to actively conduct their gold bar trading in their network. The gold bar trading points are mainly in the two major cities of Hanoi and Ho Chi Minh, and all the provinces and those cities directly under the central government also have gold bar trading points, resulting in the possibility to fully meet the needs of people.
On the other hand, as I mentioned above, SBV will set the transitional period for enterprises and credit institutions to complete application for gold bar trading licenses. For the time being, people can continue to trade gold bars in the existing shops while the licensed enterprises and credit institutions continue to branch out in order to meet the needs of people following the termination of the transitional period.
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