According to a report by Mining.com, Vietnam, Asia’s third-largest gold importer, issued a decree on Tuesday abolishing its 13-year-long state monopoly on gold. Although the government’s aim is to achieve long-term normalization of the gold market, this policy has nonetheless led to a significant surge in domestic gold prices.

　　The gold price sold by Saigon Jewelry Co., Vietnam’s largest state-owned gold and jewelry enterprise and the country’s benchmark gold price reference, has risen to 125.7 million Vietnamese dong per tael. Based on an exchange rate of 25,450 Vietnamese dong per U.S. dollar and 1.2 ounces per tael, this works out to approximately $4,096 per ounce.

　　Last year, Vietnam imported a total of 55 tons of gold bars, gold jewelry, and gold coins. The country is working hard to address distortions in the gold market. The State Bank of Vietnam’s exclusive control has led to price premiums, as well as rampant black-market trading and smuggling. A new regulation now allows commercial banks and qualified enterprises to produce, trade, and manage gold bars, with the aim of liberalizing the market, fostering competition, and strengthening regulatory oversight. This move will help bring Vietnam’s gold market into line with international practices.

　　BMO Capital Markets said on Wednesday, “This will put an end to the long-standing state monopoly in the industry, a monopoly that has sometimes led to a disconnect between domestic gold prices and international gold prices. Ultimately, this change will align gold imports with domestic demand, so we believe it’s a positive development for the global gold market.”

　　Transparency

　　This regulation also enhances transaction transparency. Any purchase or sale exceeding VND 20 million (approximately USD 760) per person per day must be conducted via a bank account. Entities holding licenses are required to issue electronic invoices and share transaction data with the central bank.

　　Although the monopoly has been lifted, the state bank will still manage imports through quotas, which will be determined by macroeconomic conditions, monetary policy, and market fluctuations. A more competitive market is expected to narrow price differences among brands, expand consumer choices, and reduce gold smuggling by creating a more orderly market.

　　Policy changes are happening rapidly. In May, Vietnamese Prime Minister Pham Minh Chinh called for reforms aimed at reducing distortions and restoring macroeconomic stability. The Vietnamese dong has depreciated sharply, sparking a surge in demand for gold as a safe-haven asset. As of early August, driven by cultural demand and currency instability, the buying price of gold in Vietnam had risen to a premium of 32% over local spot prices.

　　Gold as a store of wealth is deeply ingrained in Vietnamese culture, and demand for gold tends to increase during festivals and weddings.