Standing committee members at the session. VNA/VNS Photo

HÀ NỘI Members of the National Assembly Standing Committee yesterday highlighted significant inadequacies in gold market management, pointing to a considerable disparity between domestic and international gold prices.

They were speaking during a session discussing the supplementary evaluation report on socio-economic development, the State budget for 2023, and the early 2024 implementation of the socio-economic development plan.

Addressing the recent fluctuations in gold prices, Deputy Chairman of the National Assembly, Lieutenant General Trần Quang Phương, called for clarification on State management in this field.

"Can we just let it fluctuate like that? I have never seen a market where gold prices fluctuate so drastically," he stated.

Sharing concerns about gold market management, the Chairwoman of the National Assembly's Committee of Judicial Affairs, Lê Thị Nga, said the gold price had never been as high as it is currently, reaching VNĐ92 million per tael.

"Despite directives from the Government, gold prices continue to rise. The State Bank of Vietnam has held a few gold auctions, but prices still hit peaks. Therefore, tighter management of the gold market is needed, with State intervention," she emphasised.

Nguyễn Thị Thanh, Head of the National Assembly Standing Committee's Board for Deputy Affairs, also expressed her concerns.

She said: "Why is there such a paradox between private investment and gold investment? A more thorough assessment is needed, along with solutions for issues such as the high rate of business withdrawals, low consumer demand, low credit growth despite falling interest rates. Is there a problem with the business investment environment? While private sector investment remains very low, high investment in gold might indicate public insecurity in production investments.”

Deputy Chairman of the National Assembly Trần Thanh Mẫn said high gold prices could increase the cost of importing goods, raw materials, and foreign business loans, significantly impacting the domestic market. He urged the Government to have flexible, timely management plans to balance the goals of promoting growth and controlling inflation, especially addressing domestic gold market fluctuations.

Explaining the situation, Deputy Governor of the State Bank of Vietnam Phạm Thanh Hà stated that before 2012, market inadequacies necessitated new regulations. Consequently, Decree 24/2012/ND-CP on gold trading management was enacted. Following the implementation of this decree, the gold market became relatively stable.

However, in recent years, particularly since 2019, global economic downturns due to the COVID-19 pandemic and rising inflation, along with geopolitical tensions, have driven up international gold prices, causing domestic prices to follow suit. Especially since 2022, the domestic gold market has shown limitations, with a consistently high disparity between domestic SJC gold prices and international prices.

The main reason is the high international gold prices, which domestic prices follow. As of today, international gold prices have increased by about 14 per cent compared to the beginning of the year, with domestic prices also rising. Additionally, limited domestic supply has kept domestic gold prices significantly higher than international prices.

As a solution, Hà said that due to the supply shortage, the immediate measure would be to increase supply in the market. The State Bank will continue to hold auctions to increase supply, stabilise prices, and narrow the gap between SJC and international gold prices.

Regarding market management support measures, the State Bank has directed its branches to enhance State management of the gold market according to their assigned functions and tasks. Additionally, it will continue inspecting businesses and credit institutions involved in gold trading to ensure they comply with legal regulations on transactions and invoicing. VNS