Reset the gold market

Many economists say it's time to re-establish "order" in the gold market.

In recent days, the news that four gold trading enterprises and two banks were fined for violating regulations on gold trading activities has attracted great public attention. However, it was not until the State Bank of Vietnam (SBV) announced the inspection results that people were "surprised" by a gold market that many people have long questioned "is there an invisible hand manipulating the market during the "crazy" gold price fluctuations?"

Transparency to prevent manipulation

The State Bank of Vietnam’s inspection conclusion revealed many serious violations in the gold trading activities of large companies such as Saigon Jewelry (SJC), Phu Nhuan Jewelry (PNJ), DOJI Jewelry, Bao Tin Minh Chau and two commercial banks, TPBank and Eximbank. Typically, there was a violation of anti-money laundering regulations when not reporting large-value gold transactions.

Gold transactions at gold shops in Ho Chi Minh City. Photo: HOANG TRIEU

Mr. Tran Huu Dang, General Director of AJC Gold and Gemstone Joint Stock Company ( Hanoi ), said that according to regulations, gold bar purchases in cash worth VND400 million or more must be reported to the State Bank. However, some businesses still conduct transactions even when customers do not provide complete personal information, leading to violations of the law.

According to a gold trader in Ho Chi Minh City, the State Bank of Vietnam currently requires gold bar trading enterprises to report daily on the amount of gold bought and sold, even when there are no transactions, and to collect full personal information of customers for storage and inspection when necessary. However, for profit or competitive pressure, some enterprises may ignore the information verification process, even intentionally supporting non-transparent buying and selling behavior.

In particular, although there is no basis to determine that the price increase in the period from October 2, 2023 to April 15, 2024 is unreasonable, at SJC, the buying and selling price of gold is decided by an individual, the general director, without specific targets and bases, while this is an enterprise with a role in guiding the market. "This leads to risks in determining prices, affecting the operations of SJC Company as well as the gold market because SJC holds a relatively large market share" - the conclusion of the State Bank Inspectorate stated.

Another hot spot is that there are banks that allow customers to trade gold but do not deliver gold and actual money to enjoy the difference. This is a form of speculation, seriously violating current regulations, causing great tax risks and disrupting market order.

Need to be clear and fair

Faced with the above situation, many economic experts believe that it is time to re-establish the "rules of the game" in the gold market. According to Dr. Dinh The Hien, if the drastic instructions of General Secretary To Lam on reforming gold management policies are thoroughly implemented, the market will gradually stabilize and develop in a healthy direction.

According to him, it is necessary to first eliminate the state monopoly on the SJC gold bar brand in a controlled manner. At the same time, it is necessary to grant licenses to enterprises that meet the technical and financial conditions to produce gold bars. Expanding the right to import raw gold under state control will also contribute to increasing supply, reducing the gap between domestic and world gold prices, thereby limiting gold smuggling across the border.

"Controlling the gold market cannot stop at inspection and punishment. The management agency can completely calculate and estimate the amount of gold in the population from 2014 to 2024. If for many years there is no license to import gold but the amount sold is still large, then we need to ask: how much of that is smuggled gold?" - Dr. Hien raised the question.

He said that if gold imports were officially and within the framework to produce gold bars and gold rings, the state would not only collect taxes but also avoid foreign currency losses. At the same time, people would also have access to gold at a reasonable price, not having to buy it at tens of millions of dong per tael higher than the world price as it is now.

Associate Professor Dr. Ngo Tri Long also agreed that the gold market needs a deep reform. He said that gold is a very sensitive field, vulnerable to speculation and manipulation, especially when the macro economy shows signs of instability. The State should not directly intervene in prices or monopolize production and distribution, but must create a transparent legal framework with effective supervision and management based on market signals.

In fact, after more than 10 years of implementing Decree 24/2012/ND-CP, the State Bank's monopoly on the production of gold bars under the SJC brand has revealed many shortcomings. Domestic gold prices are often higher than world prices, causing market distortion, people's losses, and smuggling becoming increasingly sophisticated.

According to Mr. Long, this monopoly mechanism needs to be quickly eliminated. Instead, the right to participate in the market should be expanded to businesses that meet strict requirements on technology, finance, management and legal safety. At the same time, the state should soon deploy the National Gold Exchange - an electronic trading floor with a transparent mechanism, standardizing prices, and being able to control cash flow and gold investment activities in a civilized manner.

"Macroeconomic stability, flexible management of exchange rates, interest rates, and liquidity are prerequisites to reduce the role of gold as a safe haven. In addition, it is possible to mobilize gold from the people through electronic gold certificates, gold accounts, and links with the banking system. This will both help keep people safe and create more resources for the economy," Mr. Long suggested.

What do banks and gold companies say?

Following the conclusion of the inspection, a number of businesses and banks have begun to take steps to correct their violations. However, experts say this is only a short-term measure. In the long term, a new legal framework is needed to ensure that the gold market is no longer a "playground" for a few, but becomes a transparent, competitive, and integrated market with the global economy.

Big difference leads to smuggling

At the end of June 2, the price of SJC gold bars in the domestic market was commonly listed by businesses at VND115.8 million/tael (buy) and VND117.8 million/tael (sell), down about VND700,000/tael compared to the previous trading session. Meanwhile, the world spot gold price according to Kitco was recorded at about USD3,347/ounce, equivalent to VND105.7 million/tael (according to the current exchange rate), which is about VND12 million/tael lower than the price of SJC gold.

At times, this difference widened to 17 - 18 million VND/tael, causing serious irrationality and distorting the market.

Some businesses explain this price difference as a result of the scarcity of domestic gold supply, while the demand for gold from people remains high. However, according to many experts, the real reason comes from the closed distribution model and lack of competition. The fact that only a few units are licensed to distribute SJC gold bars according to current regulations has created a monopoly gold market, which does not reflect the true supply and demand and is susceptible to price manipulation.

This situation also leads to serious consequences for gold smuggling. According to data from the General Department of Customs, in the first 4 months of 2025 alone, authorities discovered and seized 350 kg of smuggled gold, nearly 3 times higher than the same period last year. This figure clearly shows the impact of the difference in domestic and foreign gold prices and the shortcomings in the current management and distribution mechanism.

Source: https://nld.com.vn/thiet-lap-lai-thi-truong-vang-196250602214157985.htm