Vietnamnet.vn
Podcast
VietNamNet Bridge – The decision by the central bank to use SJC as the
national gold brand has been applauded by bullion gold manufacturers. However,
they have proposed to share the brand.
 |
|
|
Dr Le Tham Duong, Finance & Banking Dean of the HCM City Banking University, commented that this is a right decision, saying that when the State Bank comes forward and takes over the SJC brand and holds the monopoly in making bullion gold, this will bring positive impacts to the market.
The first positive impact is that the gold market will avoid the enterprise monopoly. Secondly, the central bank will easily intervene in the market when the prices fluctuate too heavily. Thirdly, this will stop the “ask-and-grant” mechanism. And fourthly, this will allow supervising the quality of bullion gold, because all enterprises produce gold for the State Bank and the quality of the products is controlled by the State Bank.
“The State Bank of Vietnam is now the only agency which has the right to print money, so it will be quite reasonable if it holds the monopoly in making bullion gold,” Duong said.
Regarding the use of SJC brand, Duong thinks that this is also a reasonable decision, because the brand is now holding 90 percent of the market share and it has been recognized in both the domestic and foreign markets.
However, Dr Duong thinks that the State Bank of Vietnam should loosen the conditions on producing and outsourcing bullion gold, so that other enterprises such as SBJ, PNJ or Agribank, not only the Saigon Jewelry Corporation, also can become the producers that do the outsourcing SJC-brand gold for the State Bank.
He has also suggested that the conditions for gold circulation should also be loosened, because once the central bank recognizes the right of people to keep gold, it needs to create favorable conditions for gold keepers to easily purchase and sell gold.
He has warned that if the requirements are overly tight, this may lead to the establishment of an underground market, thus pushing up illegal gold production and import, which will surely influence the exchange rate.
Though applauding the decision of the governor, Duong said that the move should be seen as a temporary solution for now, while in the long term, the State bank should apply the measures to ease the “goldization” in the national economy. He said that once the inflation goes down, the dong has high value, the gold speculation will automatically stop.
A representative of Sacombank-SBJ said the company applauds the decision to use SJC as the national gold brand, saying that the company has to sacrifice the business’ benefit for the national benefit.
However, when the SBJ brand is eliminated in the future, this also means the big losses to the company, because SBJ had to spend a lot of money to import machines and equipment and to build the SBJ brand, estimated at 30 billion dong. Meanwhile, the workers of the bullion gold workshops will become redundant, and the company will have to arrange other jobs for them.
Nguyen Thanh Truc, General Director of Agribank’s Gold Company, has suggested that his company can use its machines and equipment to make SJC brand gold for the State Bank.
“We just need to buy new prototypes, about 5000 dollars for each, to be able to make SJC brand gold,” he said. “If the proposal is approved, this would help ease the waste and the losses to enterprises,” he added.
There have been no big changes in the gold market after the statement of the governor about the use of SJC as the national gold brand. Only the price can decide the market performance, while the central bank’s decision does not have big impacts. SJC gold on November 25 was traded at 44.6-44.8 million dong per tael, and there were very few transactions.
Source: VnExpress
.svg){kind=icon}
