Concerns about repeating old lessons
The Vietnam Gold Business Association (VGTA) has just issued a document commenting on the Draft amending and supplementing Decree 24 on gold market management, in which it is proposed not to allow commercial banks to participate in the production and trading of gold bars.
According to the Association, banks do not have the function of producing gold according to the current Law on Credit Institutions. Participating in this field requires large capital to invest in factories, machinery, and human resources - not suitable for the main role of granting credit and providing payment services.
VGTA cited that before 2012, some banks participated in the production of gold bars but left long-term consequences, it was necessary to rely on the drastic intervention of the State Bank to stabilize the market.
Regarding licensing conditions, VGTA believes that the minimum charter capital requirement of VND 1,000 billion is too high, currently only about 1 to 3 enterprises can meet. This could put the market in a monopoly position, further limiting the supply of gold bars.
The Association proposes to reduce the charter capital requirement to VND500 billion, and at the same time, it is necessary to further assess factors such as production capacity, business efficiency, brand reputation and compliance with the law of the enterprise.
Proposal to remove sub-licenses, issue annual limits
Regarding gold import and export activities, VGTA proposed to remove the regulation on each licensing - which is considered a "sub-license" causing difficulties in procedures. Instead, the State Bank should limit the import of raw gold, export of gold bars annually and allocate from the first quarter of the year according to the principle of publicity and transparency.
Enterprises will proactively choose a trading time suitable for international market fluctuations, thereby improving business efficiency and contributing to the regeneration of foreign currency sources. The Association also proposes to encourage the import of raw gold to produce gold bars and gold jewelry to serve domestic and export demand, instead of focusing only on gold bar trading activities.
