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Big money among the people
The decision by the State Bank of Vietnam on allowing the export of gold helped the gold market become more bustling and helped understand that the volume of money among people proves to be very big.
Tran Ngoc Minh Thu, Head of the Business Division under SJC Company, said that the market is now very bustling as Vietnamese people now sell gold when the prices increase to get profit.
The continued sale of people and the bustling market show that the volume of gold lying among people proves to be very big. Gold trading companies have estimated that the volume may reach 800 tons, or US $24 billion in the current price.
The figure showed the big financial capability of people, which helped Vietnam improve the payment balance. Vietnam saw the exports higher than imports in the first three months of the year. The exports of precious stones and metals, mainly gold, in the first three months of the year reportedly reached US $2.29 million.
Trang Van Sanh, a banking expert, said that Vietnamese people have the habit of keeping their assets in gold as they experienced a long period of economic uncertainties.
Analysts also said that the decision on gold export proves to be a reasonable move, which helps turn the ‘dead money’ into ‘live money.’ If the state does not allow the export of gold, people will still keep gold, and once gold cannot be put into circulation, the capital will not be useful for the national economy, while this will pave the way for illegal gold trading.
Sanh believes that the volume of foreign currencies among people is still bigger than gold. People also like keeping dollars, as it is more favourable to make transactions with dollars than gold.
According to the HCM City Statistics Office, the capital mobilized by the end of 2008 had reached VND 561.5 trillion, of which the capital in foreign currencies accounted for 29.2%, or VND 163.9 trillion, or US $10 billion.
There have not been official statistics about the total capital mobilized in 2008, but some organizations announced that the figure was about VND 1.2 quadrillion. Suggested that 30% of the mobilized capital is in foreign currencies (the same with the ratio in HCM City), the foreign currency capital is about VND 360 trillion, or nearly US $20 billion, according to Sanh, who noted that this was just the sum of money put into banks.
Sanh noted that if the state has suitable policies to make all the capital useful, this will help create a lot of strength for the national economy.
VietNamNet, SGTT
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