At a gold shop in HCM City. Analysts call for easing gold policies as it is no longer a speculative asset class or cash substitute. — VNS Photo

HCM CITY — With gold no longer being a speculative asset class or cash substitute, the Government should have a more reasonable policy for managing it, according to experts.

According to banking expert Dr Cấn Văn Lực said gold cannot be considered speculative since the Government has put it under strict watch since 2014.

Domestic prices are usually VNĐ5 million (US$216) per tael of 37.5gm higher than global prices, with the gap attributed to the limited supply of both jewellery and bars.

For many years the State Bank of Vietnam has not permitted the import of gold bars to produce jewellery and has a monopoly on bullion production and import-export.

So speculation has mostly died down.

He told Người Lao Động (The Labourer) newspaper: "However, in the long run authorities should have a solution to equalise domestic and international gold prices. Such a big difference can lead to speculation and smuggling of gold into the country."

According to economist Ngô Trí Long gold is no longer used to make payments like it used to be, and so if it is considered just a commodity, it is necessary to be globally connected, especially when Việt Nam is deeply integrating into the international market.

The country does not produce much gold, and so has to import, and authorities should soon ensure there is an increase in the supply for gold to bring down prices.

The Vietnam Gold Traders Association has petitioned the SBV to grant licences to businesses to produce and sell gold bullion.

On the afternoon of March 11 in HCM City, Saigon Jewelry Company bought gold at VNĐ55.4 million ($2,390) per tael and sold it at VNĐ55.8 million ($2,410).

Globally, the metal traded at $1,736 an ounce (or $2,091) per tael, making domestic prices by VNĐ7 million per tael higher. — VNS