Firm to disclose dollar reserves

March 01, 2011 | 17:05
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Commercial banks have been ordered by the State Bank of Vietnam to report on the foreign currency deposits of 99 major State-owned enterprises by the end of this week.
illustration photo

Late last week, Prime Minister Nguyen Tan Dung required major State-owned companies to sell all their foreign currency to banks, and banks will have to sell their dollars at the official exchange rate when needed.

This is seen as an aggressive move to boost the value of the dong and the supply of dollars in circulation in the economy.

Large State-owned groups and corporation are major dollars holders and their foreign currency accumulation has been seen as a major factor in recent dollar shortages.

"Once they are required to sell dollars back to commercial banks, the supply of foreign currency on the market will be increased significantly and forex will not be as knotty," said director of the capital business division of the Bank for Investment and Development of Vietnam Nguyen Manh.

A document issued to commercial banks ordered the banks to report foreign currency on deposit by a list of 21 State-owned groups and 78 corporations which together sell about 5-$6 billion to commercial banks annually.

The State Bank's order recalls the situation on the foreign exchange market in December 2009, when the Government required seven national groups and corporations to sell US dollars to commercial banks to slow the rapid appreciation of the dollar against the dong. At that time, the dollar deposits of these major State-owned enterprises totalled $1.2 billion.

The dollar shortage has extended the gap between official and black market exchange rates, requiring companies to pay more on the black market for the US dollars they need to import. On the black market on Feb. 28, the dollar fell by about VND100 from Feb. 27's rates to 21,880-VND21,950.


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