Commenting on the draft Decree amending and supplementing a number of articles of Decree 24 on the management of gold trading activities, the Vietnam Gold Trading Association recommended that there should be specific mechanisms and policies to support and encourage businesses to produce, process and export gold jewelry.
Specifically, enterprises producing and exporting gold jewelry should be given priority in importing raw gold without any restrictions on volume. The procedure only requires reporting to the competent state agency about import turnover... The state supports enterprises in researching and expanding the gold jewelry export market.
The Association affirms that the capacity and level of Vietnamese gold production and processing enterprises today not only meet domestic demand but are also capable of exporting to the world market; in the export value, more than 25% is the value of labor. This is also a unique characteristic of gold products.
“Therefore, although foreign currency must be used to import raw gold, it is an input material for production. After production and processing into gold jewelry, not only can foreign currency be restored by export (including on-site export). This also answers the question of whether allowing the import of raw gold will affect foreign exchange reserves?”, the association’s document stated.
Citing data from the General Statistics Office, the association said that the proportion of foreign currency spent on importing consumer goods such as cosmetics, cigarettes, alcohol, etc. is many times higher than the amount of foreign currency spent on importing raw gold.
Specifically, in 2024, the State Bank of Vietnam (SBV) spent nearly 1.4 billion USD to import about 13.5 tons of raw gold to produce SJC gold. This amount of foreign currency accounts for only 0.3% of the country's import turnover in 2024 of 380.76 billion USD and is equal to 5.7% of the import value of consumer goods of 24.33 billion USD.
According to the association's estimate, the demand for raw gold to produce gold bars and jewelry is about 50 tons/year on average, equivalent to about 5 billion USD/year (about 416 million USD/month). After being put into production, 1/2 will be processed to meet domestic demand, 1/2 will be exported, that is, 25 tons for exporting jewelry gold can earn from 3.5 to 4 billion USD.
The association also calculated that the demand for foreign currency to import raw gold is about 5 billion USD/year, or an average of about 416 million USD/month. This figure is very small compared to the foreign currency trading turnover in the interbank foreign exchange market of about 900 million to 1.2 billion USD/day, or about 18.9 billion to 25.2 billion USD/month.
Therefore, the association believes that the average purchase demand of 416 million USD/month to import raw gold is within the capacity of commercial banks, does not affect the supply and demand of the foreign exchange market, and therefore does not need to use foreign exchange reserves to intervene in the foreign exchange market.
In addition, the association also proposed to remove regulations on conditions for gold jewelry production and procedures and documents for granting certificates of eligibility for gold jewelry production activities, and to remove regulations requiring gold jewelry production enterprises to purchase raw gold from import centers that are credit institutions.
At the same time, the association also proposed to remove the regulation: Enterprises are only allowed to import gold bars and raw gold from gold producers certified by the London Bullion Market Association (LBMA).
The Association believes that businesses have had to go through many administrative procedures to participate in the production of gold bars, businesses have gone through many administrative procedures to be granted licenses to produce gold bars; to be granted import limits for gold bars and raw gold. If we limit the place of purchase (supply market), it has no legal basis and violates the freedom of business of businesses.
Source: https://vietnamnet.vn/hiep-hoi-vang-nhap-my-pham-ruou-ton-ngoai-te-gap-nhieu-lan-nhap-vang-2413026.html
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