General Secretary To Lam: Eliminate State monopoly on gold bars

Poor gold market management

On the afternoon of May 28, General Secretary To Lam worked with the Central Policy and Strategy Committee. At the meeting, Secretary of the Party Central Committee and Head of the Central Policy and Strategy Committee Tran Luu Quang presented a report assessing and proposing mechanisms and policies to effectively manage the gold market in the coming time.

Mr. Tran Luu Quang affirmed that the viewpoint of the Central Policy and Strategy Committee is to manage the gold market according to market principles, with appropriate state management; eliminate the mindset of banning if it cannot be managed; respect ownership rights, property rights, and freedom of business; and ensure transparency in the market.

General Secretary To Lam: Eliminate the State monopoly on gold bars photo 1

General Secretary To Lam speaks at the working session. Photo: Central Policy and Strategy Committee.

Regarding specific mechanisms and policies, the Central Policy and Strategy Committee proposed two groups of solutions, including solutions that need to be prioritized for immediate implementation and solutions that need to be researched for application or pilot application. The solutions need to be implemented step by step, with a clear roadmap and adjusted to suit reality. The most important thing is to build people's trust in the financial system and state policies, contributing to bringing gold resources to serve economic development.

Concluding the meeting, General Secretary To Lam highly appreciated and basically agreed with the content of the report of the Central Policy and Strategy Committee; highly appreciated the frank, enthusiastic and useful contributions of the delegates attending the meeting.

The General Secretary emphasized that the mechanisms and policies for managing the gold market in Vietnam have been positively adjusted and improved in recent years. However, it is also necessary to frankly acknowledge that the mechanisms and policies for managing and regulating the gold market have been slow to be renewed, have not kept up with the development of the market and the demands of reality, and need to be urgently renewed and improved.

The General Secretary cited a report from the Central Policy and Strategy Committee, showing that:

The gold market is poorly managed and not in line with the general supply and demand trends in the world market, causing consequences for the economy, especially gold smuggling and foreign currency outflows.

Second, there is a monopoly in the market, which does not stimulate competition and promote healthy gold trading activities.

Third, the management mechanism and policies have not created the motivation to mobilize idle resources among the people for socio-economic development, people invest a lot in gold. Fourth, the management method is still mainly traditional, slow to innovate, lacking modern business forms, catching up with world trends.

Shifting mindset from “tighten to control” to “open to govern”

The General Secretary emphasized the need to thoroughly grasp a number of requirements regarding viewpoints, goals, tasks, and solutions for the coming time.

Regarding viewpoints, according to the General Secretary, it is necessary to strongly shift from administrative thinking to disciplined market thinking, from "tightening to control" to "opening to manage"; it is imperative to thoroughly grasp and eliminate the thinking of "if you can't manage, then ban"; at the same time, it is necessary to make the gold market operate in accordance with market principles, with state management.

General Secretary To Lam: Eliminate the State monopoly on gold bars photo 2

Head of the Central Policy and Strategy Committee Tran Luu Quang speaks at the meeting. Photo: Central Policy and Strategy Committee

The General Secretary noted that it is necessary to avoid rigid intervention, restrict the movement and promote the advantages of the market, ensure the principle of respecting the ownership rights, property rights, and freedom of business of people and enterprises; and ensure transparency in the market. At the same time, it is necessary to identify people's gold storage as a form of savings and investment, a legitimate need, and to respect and approach the development of appropriate management mechanisms and policies based on this viewpoint.

Regarding the goals, the General Secretary said that it is necessary to effectively manage the gold market, stabilize the macro-economy, and mobilize resources for socio-economic development.

Regarding tasks and solutions, the General Secretary emphasized that first, it is necessary to complete the legal framework, quickly amend Decree 24/2012/ND-CP in the direction of marketization with a roadmap and strict control; creating a more effective connection between the domestic gold market and the international market.

Second, eliminate the State monopoly on gold bar brands in a controlled manner based on the principle that the State still manages gold bar production activities, but can license many qualified enterprises to participate in gold bar production to create an environment of equal competition, thereby helping to diversify supply sources and stabilize prices.

Third, expand controlled import rights to increase gold supply, contributing to reducing the gap between domestic and world gold prices, and at the same time limiting gold smuggling across borders.

Fourth, encourage the development of the domestic gold jewelry market to gradually turn Vietnam into a center for manufacturing and exporting high-quality gold jewelry, transforming stored gold into value-added products.

Fifth, develop attractive alternative investment channels to mobilize gold from the population into the economy.

Sixth, improve management efficiency and inter-sectoral coordination, especially in preventing and combating gold smuggling.

Seventh, promote the role of the Gold Business Association, act as a bridge between gold businesses and management agencies, promptly reflect difficulties, make recommendations and coordinate the implementation of market stabilization measures when necessary.

Eighth, maintain macroeconomic stability and confidence in the Vietnamese currency, considering this a fundamental, long-term solution to transform resources from gold into economic development.

9. Early construction of information and data system on the gold market to increase publicity and transparency, to collect taxes, manage, and assess the impact on the foreign exchange gold market, exchange rates, and various investment channels.