Many people are paying special attention to the direction of amending Decree 24 on the management of gold business activities and the ability to abolish the monopoly of gold pieces. When the large price difference between SJC gold and the world still persists, countless investors “lament” for gold. In fact, this is not the first time that domestic gold prices have continuously “fluctuated” in a short period of time. Since the middle of August last year, SJC gold prices have started to become chaotic, with rapid and strong increases and continuously reaching the highest peak ever, up to 80 million dong per tael. In fact, domestic gold prices can sometimes increase or vary in the opposite direction compared to world gold prices. It can be said that SJC gold prices are currently following the “one market, one price” model.
Some people expressed their opinions: “I feel that in the past year, gold prices have continuously had fluctuations, even increased at unprecedented levels”; “Gold is one of the financial and reserve products. However, the gold market has been increasing quite rapidly and unexpectedly in the past year. Meanwhile, the price of gold is predicted to continue to rise.”
Just 1 week after the God of Wealth’s day, the domestic gold price witnessed continuous fluctuations
According to the assessment of financial and banking expert Nguyen Tri Hieu, the most unreasonable point of the current gold market is the price difference between domestic gold and the world. At some points, SJC gold prices were higher than world gold prices by more than 19 million dong per tael.
Referring to the reasons, economic expert Nguyen Tri Hieu stated: “At present, domestic gold prices are much higher than world gold prices. And in the country, buying prices are still higher than selling prices. And the gold market is not interconnected with the world to adjust. Over the years, the State Bank has not allocated quotas for SJC gold nuggets. Perhaps some gold businesses should be allowed to import world gold so that the gold price can be interconnected with the world.”
Looking back over 10 years ago, gold was considered one of the preferred means of payment, and many high-value transactions were converted into gold, making management agencies worry about the situation of “goldizing the economy”.
Therefore, Decree 24 was born and has achieved good results, bringing about order and stability in the gold market as shared by Mr. Dinh Nho Bang, Vice Chairman cum Secretary General of the Vietnam Gold Business Association (VGTA): “Decree 24 was born is appropriate and has a very good effect, stabilizing the gold market and well controlling the production and business of gold pieces. Secondly, in terms of orientation, it encourages the production of fine-art jewelry…”
However, the current gold market scenario of “one market, one price” has posed a necessary requirement to amend this decree to be more suitable with reality in the direction of avoiding the “monetization” of SJC gold.
Pointing out some shortcomings, lawyer Pham Thanh Tai, Pham Danh Law Company said: “After 10 years of implementing Decree 24, the economic context has changed a lot. Some provisions of Decree 24 have become obsolete and need to be reviewed and assessed to be more suitable with the new economic situation. The competent authorities need to study and incorporate appropriate content to create competitiveness with the current SJC gold, thereby reducing the price of gold and making it more suitable with the world gold price.”
Along the same lines, GS.TS. Hoang Van Cuong, a member of the Finance and Budget Committee of the National Assembly, analyzed that the reason why domestic gold prices are “one market, one price” is due to the monopoly of gold piece production and the monopoly in the management of raw gold imports and exports for production gold pieces.
It is very necessary to change the management method, amend Decree No. 24
In fact, in recent years, the state has almost taken an SJC gold brand as a national gold brand. Although SJC and other gold pieces can have the same quality, this is a national gold brand, so it is naturally trusted, accumulated to ensure the highest safety, so people all want to buy, accumulate, and own it. However, when the supply is not available while the demand is real, a supply-demand imbalance will lead to an increase in gold prices.
“It is very necessary to change the management method, amend Decree No. 24, not necessarily monopolizing the state on one gold brand. Many businesses can be allowed to participate in the process of producing gold pieces to meet the needs of the people, and the supply source is freely competing equally to avoid scarcity. Moreover, there must be interconnection between the domestic and international markets,” said GS.TS. Hoang Van Cuong.
In Directive No. 06 dated February 15, Prime Minister Pham Minh Chinh urgently requested the State Bank to review Decree No. 24 on the management of gold business activities. Along with that, propose effective management solutions for the gold market in the new situation and must be completed in the first quarter of this year.
Immediately after that, Deputy Prime Minister Le Minh Khai also directed the State Bank to quickly review Decree 24, report the results of inspecting the gold market in February, and avoid a high domestic gold price compared to the world gold price.
