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Changes sought for draft gold trading rule
Vice Chairman Dinh Nho Bang of the Vietnam Gold Traders Association said the association has submitted its petition to the central bank indicating the unfeasibility of a draft decree on gold bar trading management.
The petition suggested more flexible regulations on gold trading. Particularly, the central bank should not disallow the business of experienced gold bar traders, to ensure the conditions to trade gold for people, especially those in remote areas.
The number of gold shops has dropped due to the strict conditions for gold trading, including the chartered capital from VND100 billion, the annual revenue of VND500 million for two consecutive years and the branch system in three different provinces, distressing those demanding to trade gold.
Though gold bars are no longer used for pricing and settling payments, citizens still prefer holding on to gold assets. Therefore, the gold association said inappropriate changes might have a far-reaching impact on people’s lives.
Narrowing the gold bar output may result in people accumulating gold in the form of rings, bracelets, chains and other jewelry, causing more difficulties for management. Besides, gold buyers can incur losses from unqualified products.
Bang said with only one kind of gold bar approved for production, consumers’ choices would be slashed given the current eight different gold bar brands on the market with different prices. In addition, this would ignite public discontent on the monopoly of Saigon Jewelry Holding Company (SJC) in gold bar production.
“The draft decree should provide specific progress for over 10,000 gold traders to switch their business models and for consumers to have time to adapt,” said Bang.
In the petition, the association also suggested the Government establish a national gold trading floor to offer a transparent venue for investors and lessen the people’s demand for gold accumulation. This would also help unify the market prices, preventing speculation.
The association proposed the gold floor be put under the central State Bank of Vietnam. Investors can make trading orders at the member gold companies and commercial banks.
Last week, Bao Tin Minh Chau Company was trading Thang Long Dragon gold at significantly lower prices than quoted prices of SJC gold due to the poor demand for this gold bar brand. However, gold trading activities occurred normally at other companies where gold prices were not that much different from those of SJC products.
Nguyen Thi Cuc, Deputy Deneral Director of Phu Nhuan Jewelry Joint Stock Company (PNJ), said the firm is producing and selling PNJ-DAB gold bars as usual and recorded no rush to sell gold bars of this brand.
“When the draft decree on gold bar trading management comes out, we will stop our production. Our company commits to buy back gold of this brand at market prices from consumers,” said Cuc.
vietnamnet, SGT
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