For the first time in over a decade, Vietnam may allow companies to import gold to narrow the widening gap between local prices and international benchmarks, an industry official told Reuters.
Hoang Trung Quyet, Vice Chairman of the Vietnam Gold Traders Association (VGTA), stated that the association has been in long-term talks with the government to address the imbalance between gold supply and demand.
Since 2012, the Vietnamese government has almost completely controlled gold imports and local sales, allowing certain large companies to import gold only if it is processed into jewelry for export.
During the Asia-Pacific Precious Metals Conference, Hoang Trung Quyet said, "We hope they can allow gold companies to directly import raw materials for jewelry manufacturing by July." He added that this would depend on the decision of the State Bank of Vietnam regarding the association's petition for future changes in gold management policies.
If implemented, this would mark a significant shift from the current policy, where the central bank strictly controls imports. The State Bank of Vietnam did not respond to requests for comment.
Attempts to increase liquidity by holding auctions and allowing four local banks to sell gold have failed to consistently narrow the gap with international benchmarks, as local prices remain higher than global prices.
Reducing the local price premium is critical as the VGTA estimates that Vietnam's gold demand will surge this year. The Southeast Asian nation is among the top ten gold consumers worldwide.
Hoang Trung Quyet noted at the conference that gold purchases in the first six months of this year are expected to rise by 10% year-on-year to 33 tons.
Retail buyers view gold as a hedge against economic uncertainty, making up the largest portion of purchases in this Southeast Asian country. Vietnam has a population of about 100 million.
