The Vietnam Gold Trading Association (VGTA) has just sent a document to the State Bank to comment on the draft decree amending Decree 24/2012/ND-CP on the management of gold trading activities.
Accordingly, it is proposed that "credit institutions, especially commercial banks, should not be added to participate in the production and trading of gold bars". VGTA believes that according to regulations, credit institutions and commercial banks do not have the function and task of producing gold. If banks participate in the production and trading of gold bars, they will have to use a large amount of capital to invest in factories, machinery, workers, etc., thereby affecting the core task of providing credit to the economy .
"History has proven that commercial banks were ineffective in producing and trading gold bars before 2012. Allowing commercial banks to produce and trade gold has left long-lasting consequences, forcing management agencies to find solutions to stabilize the situation," the VGTA document stated.
VGTA recommends that commercial banks should not participate in the production of gold bars.
Regarding the conditions for granting production licenses to enterprises, the association also proposed removing the provisions in the draft that "enterprises must have a license to trade in gold bars" and "minimum charter capital of VND 1,000 billion or more".
According to VGTA, with the above regulation, only 1-3 enterprises will meet this charter capital requirement. The number of enterprises that can participate in gold bar production is still insignificant, leading to the market still being able to fall into a state of monopoly in production and supply of gold bars, limiting the supply of gold bars...
Regarding the price of SJC gold bars, at the end of June 19, companies listed it at 117.4 million VND/tael for buying and 119.4 million VND/tael for selling, down 200,000 VND/tael compared to the morning.
VGTA also suggested that the State Bank refer to the actual initial capital needs of Saigon Jewelry Company (SJC) to invest in gold bar production, thereby having regulations that are closer to reality. According to VGTA, this figure at VND500 billion is appropriate. At the same time, in addition to the charter capital requirements, the management agency should focus on requirements on production capacity (assets, facilities, techniques); business efficiency; reputation and brand.
If the charter capital is from 500 billion VND or more, there will be about 5-7 reputable enterprises with effective business and real capacity to participate in the production and supply of gold bars to the market, diversifying the supply of gold bars with many different brands but ensuring standards and quality to meet market demand.
Source: https://nld.com.vn/vi-sau-co-de-xuat-ngan-hang-khong-nen-tham-gia-san-xuat-vang-mieng-196250619182455118.htm
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