Hanoi (VNS/VNA) - The Government has directed the State Bankof Vietnam (SBV) to urgently inspect and supervise to stabilise the goldmarket.

Under a document issued early this week, Deputy Prime Minister Le Minh Khairequested SBV Governor Nguyen Thi Hong to coordinate with relevant agencies tourgently and effectively implement tasks and solutions to manage and stabilisethe gold market.

The Deputy PM also assigned the SBV to coordinate closely with relevantagencies to urgently carry out close and comprehensive inspection andsupervision of the gold market. The supervision and inspection must be carriedout with gold trading enterprises, stores and distribution agents.

The Government’s move is to ensure the stability and safety of the gold market,and contribute to limiting the “goldenisation” of the economy, besides ensuringnational financial and monetary security, and developing a safe, healthy,effective and sustainable gold market.

The Prime Minister requires a report on the results of handlingthese tasks in March 2024.

In fact, the Government has repeatedly requested the SBV to take measures tomanage the gold market to prevent gold bar prices from being too high comparedto the world since the end of last year.

The Prime Minister has recently requested the SBV to urgently re-assess Decree24/2012/ND-CP, which governs the management of gold import and exportactivities by the SBV, to determine its effectiveness and propose necessarychanges to adapt to the current state of the gold market. The amendment isaimed to align supply and demand and consider alternative approaches to goldmarket management.

Under Decree 24/2012/ND-CP, the SBV has a monopoly on gold production andimport, while Saigon Jewelry Company (SJC) was the sole maker of SJC-brandedbullion.

According to experts, together with the general Vietnamese preference ofkeeping gold as a means of reserve to hedge against inflation and risks, themonopolies cause imbalance in supply and demand in the gold market, causingdomestic gold prices to differ widely from world prices. At some points, theprice gap was up to 20 million VND a tael, which was unreasonable.

With huge gaps in domestic and world gold prices, smuggling forprofit increases, which makes it difficult to manage the gold market, causesloss to the State budget and poses risks to foreign exchange rates. Speculationand manipulation are also distorting the domestic gold market.

They therefore propose it is time to amend the decree and hope that the goldmarket will experience greater liberalisation in the future. Any newregulations permitting gold imports will help narrow the gap between domesticand international gold price, safeguarding the rights of investors./.