National Assembly Economic Committee: People find it difficult to buy gold bars

In the socio-economic report presented at the opening session of the 8th Session of the 15th National Assembly on the morning of October 21, the Government said that solutions to intervene and stabilize the gold market have been implemented drastically, helping to stabilize the psychology of people and businesses. The gap between domestic and international prices has decreased. The sale of SJC gold bars through 4 State-owned commercial banks and SJC helps this item reach people in need directly.

Authorities also increased monitoring, inspection and handling of speculation, smuggling and violations in gold trading. Currently, 100% of gold trading enterprises apply electronic invoices connected to tax authorities.

However, during the review, the National Assembly's Economic Committee said that gold market management is still inadequate, causing pressure on the foreign exchange market and exchange rates.

"It is very difficult for people to buy SJC gold bars when ordering online. This shows that the current price of gold bars does not accurately reflect market supply and demand," the inspection agency stated.

In fact, the demand for gold in the country is high. The number of customers registering at state-owned banks and SJC is always "full" after just a few minutes of the first hour. The maximum number of registered buyers is only 1-2 taels. Banks such as Vietcombank and VietinBank constantly change the method and time of gold delivery to customers. From the place of gold delivery during the day, buyers at these units receive it after two working days from the time of registration and successful transaction.

The remaining brands that trade in gold bars such as DOJI, PNJ, Bao Tin Minh Chau... have also almost stopped selling gold bars to the market since the State Bank intervened to "determine the price" of this type, due to lack of resources.

The National Assembly's Economic Committee acknowledged the State Bank's efforts to stabilize the market, through bidding for SJC gold bars or selling gold to four state-owned commercial banks. These units supply precious metals to the market through online sales channels or banking applications (apps), then people receive gold directly at branches and agents. This helps reduce the difference between domestic and international SJC gold bar prices to around 5-7%.

"However, the domestic and international price gap will be difficult to maintain as it is now when market intervention measures are stopped," the agency said.

According to data from the National Financial Supervisory Commission, the gold price gap between the two markets has increased sharply since 2020. This year, there was a time when the gap was recorded at VND20 million per tael, 8.3 times higher than the average of the 2012-2020 period. This gap is due to the high demand for gold, while the supply of gold bars is tightly controlled. On the other hand, the supply of raw gold for the production of gold bars and jewelry is also controlled through annual import quotas.

Supply is scarce amid the continuous sharp increase in gold prices. In September, domestic gold prices increased by 22.6% compared to the end of 2023 and nearly 32.3% compared to the same period last year. On average, the precious metal is nearly 26.3% more expensive than the same period in 9 months, when world prices hit a record high.

Each tael of SJC gold bar on the morning of October 21 increased to 88 million VND for selling, after the State Bank changed the selling price to intervene. The purchasing price of business units also increased accordingly, to 86 million VND per tael. The difference in domestic and world gold prices currently fluctuates between 2-4.5 million VND per tael.

In addition to gold, the auditing agency also pointed out difficulties in the bond market.business. In the first 9 months of the year, there were 268 private issuances, nearly 250,400 billion VND, 15 public issuances with more than 27,000 billion VND. The pressure to repay corporate bonds due is large, nearly 79,860 billion VND. Of which, about 35,137 billion VND (equivalent to 44%) of real estate bonds are due.

The corporate bond market is facing challenges to become a channel for mobilizing medium- and long-term capital for the economy, according to the National Assembly's Economic Committee.

The reason is that this market is small in scale compared to the long-term capital needs of enterprises. The total outstanding debt of this market as of the end of August was more than 1 quadrillion VND, equivalent to 10% of GDP. This figure is lower than Malaysia (54% of GDP), Singapore (25%), and Thailand (27%).

In addition, the issuance structure is not reasonable when individual issuance accounts for 88%, and public issuance is limited (12%). "This limits the ability of enterprises to access capital from public investors, creating risks to market transparency," the audit agency commented.

The market also lacks a pricing mechanism, especially the determination of yield to maturity for bonds, as well as data on the probability of default (PD) of the issuers. This makes it difficult for investors to evaluate, increases risks for individual investors and limits the ability to build a standard yield curve for the market.

"Corporate bonds want to become a medium- and long-term capital mobilization channel, requiring efforts from management agencies, financial institutions and the issuing enterprises themselves," the Economic Committee stated.

This year, the Government sets a growth target of 7%, higher than the National Assembly's target (6-6.5%). To achieve this target, the auditing agency recommends that the Government strictly control credit, bad debt, risks in the stock market, gold, corporate bonds and real estate...