Gold moves yet to shine

Foreign-invested firms processing and trading in jewels were disappointed that draft circular to Decree 24/2012/ND-CP of April 3, 2012 regulating gold business management did not mention export jewel gold content inspection, which is the biggest challenge for firms.

In November 14, 2011 the Ministry of Finance (MoF) enacted Circular 157/2011/TT-BTC requiring gold traders to inspect gold content before exporting to avoid firms dodging regulations.

Tran Thi Hieu, in charge of export-import at Haiphong-based Estelle Vietnam, said: “We import 24-Karat (or 24k) gold for 18k and less gold jewel production with 98 per cent of products for export. State regulations requiring us to inspect gold content before exporting is hurting us.”

It costs the company three days and around VND10 million ($476) in expenses for each inspection.

Similarly, Japan-backed GL director Truong Thi Hanh said: “We import 75 per cent purity gold for jewel production. It is unreasonable when it costs us over VND50 million ($2,400) inspection expenses each month before products are exported.”

A Hanoi-based foreign-invested firm processing and exporting gold assumed the MoF would demand firms inspect their jewel gold content before exporting. However, more independent inspection offices should be opened to facilitate inspections.

It also suggested exempting firms importing low purity gold for jewel production from inspection.

Also under the draft circular, foreign-invested firms are not obliged to show permits when importing-exporting physical gold and jewels made of import materials. They are only required to apply for annual quotas on physical gold import.

“Basically, gold management policy towards foreign firms in this field remains unchanged,” said the head of State Bank’s Foreign Exchange Department Nguyen Quang Huy.

Vietnam Gold Business Association said most foreign-backed firms mostly processed jewels for export, so that their operations did not hurt Vietnam’s foreign currency reserves.

State Bank’s former head of Foreign Exchange Department Phi Dang Minh said “FDI firms producing and trading in gold products are mainly for export, they can even bring more foreign currencies to the country.”