Vietnam Gold Market

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Vietnam Gold Market

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  • The Asian economies look like they will pick up before Europe.
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  • chao anh, em rat quan tam den bai viet cua anh, anh co the cho em thong tin lien lac duoc ko a? Em muon hoi anh 1 so van de nua. Rat cam on anh
    HIen tai em dang hoc Master of Eco tai Han Quoc.
    ANh cho em bai viet + slide ppt cua bai viet Vietnam Gold Market duoc ko a?
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  • http://www.dztimes.net/post/business/gold-assoc-suggests-tighter-gold-trade-not-ban.aspx
  • http://english.thesaigontimes.vn/Home/business/other/16240/
  • Vietnam Gold Market

    1. 1. VIETNAM GOLD MARKET International Finance - Group 2 Tran Cong Tuong Le Xuan Long April - 2011
    2. 2. AGENDA <ul><li>Overview of Vietnam gold market </li></ul><ul><li>Gold in eyes of government </li></ul><ul><li>Gold in eyes of producers </li></ul><ul><li>Gold in eyes of consumers (Vietnamese people) </li></ul><ul><li>Gold in eyes of investors </li></ul><ul><li>Gold in eyes of lovers </li></ul>
    3. 3. Overview of Vietnam Gold Market
    4. 4. Gold Demand of Vietnam <ul><li>Demand in 2010 * : 81.4 tons ($ 3.232 million) </li></ul><ul><ul><li>Bar: 67.0 tons ($ 2.674 million) </li></ul></ul><ul><ul><li>Jewelry: 14.4 tons ($ 558 million) </li></ul></ul><ul><li>Gold kept among Vietnamese: around 500 tons ($ 19.852 million) (unofficial data) </li></ul><ul><li>World’s largest gold consumer (in term of per capita income) </li></ul><ul><ul><li>India and China: world's largest gold consuming (in term of value) </li></ul></ul><ul><li>* Source: GFMS, WGC </li></ul>
    5. 5. Gold Bar Demand ( Q4 2010 vs Q4 2009)
    6. 6. Jewelry Demand (Q4 2010 & Q3 2010)
    7. 7. Import & Export <ul><li>Strictly control by SBV </li></ul><ul><ul><li>Need official permits </li></ul></ul><ul><ul><li>Quota </li></ul></ul><ul><ul><li>Only for big gold firms </li></ul></ul><ul><li>Official statistic: 1998 – Sep. 2010 </li></ul><ul><ul><li>Export: 268.86 tons (22.4 tons per year) </li></ul></ul><ul><ul><li>Import: 339.86 tons (28.3 tons per year) </li></ul></ul><ul><li>Illegal import of gold (smuggling): 20-40 tons per year (unofficial data) </li></ul>
    8. 8. Vietnam Gold Price (04/2010 – 04/2011)
    9. 9. Vietnam Gold Price in Ten Years
    10. 10. World Gold Price in Ten Years
    11. 11. Return on Investment – Feb/2011 (monthly)
    12. 12. Gold in Eyes of Government
    13. 13. Regulating Gold Market - Objectives <ul><li>Stabilize macro-economy (inflation) </li></ul><ul><li>Utilize gold kept among Vietnamese </li></ul><ul><li>Eliminate gold as a means of payment in the economy </li></ul><ul><li>Control and stabilize gold market </li></ul><ul><li>Prevent gold smuggling </li></ul>
    14. 14. Current Management in Gold Market <ul><li>Shut down local gold exchanges </li></ul><ul><li>Ban gold trading on foreign accounts </li></ul><ul><li>Strictly control import/export gold </li></ul>
    15. 15. Government's Resolution for Gold Market (Resolution 11/NQ-CP) <ul><li>Stopping gold mobilizing and lending by credit institutions </li></ul><ul><ul><li>Still lend gold for producing jewelries </li></ul></ul><ul><li>Strictly controlling the gold market </li></ul><ul><li>Closely monitoring & forecasting fluctuations of international gold price, gold supply & demand in domestic market </li></ul><ul><li>Submitting Decree on gold management and trading for certain major gold importers </li></ul>
    16. 16. Government's Resolution for Gold Market (cnt.) (Resolution 11/NQ-CP) <ul><li>Prohibiting gold bar trading </li></ul><ul><li>Inspecting speculation, hoarding and manipulation in gold market </li></ul><ul><li>Revising the regime of administrative penalties against violations in gold trading </li></ul><ul><li>Enhancing supervision and dealing with violations of gold trading of institutions and individuals </li></ul>
    17. 17. Gold in Eyes of Producers
    18. 18. Gold Producers <ul><li>Gold companies </li></ul><ul><ul><li>About 20 big firms: SJC , PNJ, SBJ, AJC… </li></ul></ul><ul><li>Gold shops </li></ul><ul><ul><li>Thousands of gold shops in Vietnam </li></ul></ul>
    19. 19. Gold Products <ul><li>Gold bar </li></ul><ul><li>Jewelry </li></ul><ul><ul><li>Ring </li></ul></ul><ul><ul><li>Earrings </li></ul></ul><ul><ul><li>Bracelet </li></ul></ul><ul><ul><li>Pendant </li></ul></ul><ul><ul><li>Chain </li></ul></ul><ul><ul><li>Necklace </li></ul></ul>
    20. 20. Gold Bars
    21. 21. Gold Jewelry
    22. 22. Suggestions for Gold Management * <ul><li>Not forbid the gold bar trading, just tough conditions </li></ul><ul><ul><li>Charter capital: 30 billion VND </li></ul></ul><ul><ul><li>Annual revenue: 500 billion VND </li></ul></ul><ul><li>Physical gold bar trading to be limited, gold trade on account </li></ul><ul><li>Establish national gold exchange </li></ul><ul><li>Gold trade account in foreign countries </li></ul><ul><li>Raise import tax (0%->0.5%), decline export tax (10%->0.5%) </li></ul><ul><li>* Source: Vietnam Gold Traders Association </li></ul>
    23. 23. Suggestions for Gold Management (cnt.) <ul><li>Create new forms of gold trading </li></ul><ul><ul><li>Physical gold trading (current) </li></ul></ul><ul><ul><li>Exchange-traded funds (ETFs), </li></ul></ul><ul><ul><li>Investments through accounts </li></ul></ul><ul><ul><li>Gold derivatives </li></ul></ul><ul><li>Sustainable and long-term policies for gold market </li></ul>
    24. 24. Gold in Eyes of Consumers
    25. 25. In Eyes of Vietnamese People <ul><li>Gold is very special to Vietnamese people </li></ul><ul><li>Any precious thing is considered as gold (quí như vàng) </li></ul><ul><ul><li>Silent is gold (Im lặng là vàng) </li></ul></ul><ul><ul><li>Girl’s virgin is considered as gold (Mất cái ngàn vàng ) </li></ul></ul><ul><li>Gold jewelries are used in special occasions: </li></ul><ul><ul><li>Gifts for wedding </li></ul></ul><ul><ul><li>Tet holiday </li></ul></ul>
    26. 26. In Eyes of Vietnamese People (cnt.) <ul><li>Gold was a common unit of price </li></ul><ul><ul><li>Real estate transaction </li></ul></ul><ul><ul><li>Motorbike transaction </li></ul></ul><ul><li>Gold is a great stored of value </li></ul><ul><li>They keep track of gold price so closely </li></ul>
    27. 27. Why Does Vietnamese Keep Gold? <ul><li>Gold price tends to rise over time (a stored of value) </li></ul><ul><li>Gold divided into extremely small portions, easily transported & kept for a long time </li></ul><ul><li>Gold purchased & exchanged easily </li></ul><ul><li>Dong devaluation </li></ul>
    28. 28. Gold in Eyes of Investors
    29. 29. Who are Gold Investors? <ul><li>Central banks </li></ul><ul><li>Gold speculators </li></ul><ul><li>Financial institutional organizations </li></ul><ul><li>Gold producers </li></ul><ul><li>Private investors </li></ul>
    30. 30. Why Do We Invest in Gold? <ul><li>Gold as portfolio diversifier </li></ul><ul><li>Gold as an inflation hedge </li></ul><ul><li>Gold as dollar / VND hedge </li></ul><ul><li>Gold as safe haven asset </li></ul>
    31. 31. Investment Vehicles in Gold Market <ul><li>Gold bars / coins </li></ul><ul><li>Gold exchange-traded products </li></ul><ul><li>Gold accounts </li></ul><ul><li>Gold certificates </li></ul><ul><li>Gold futures and options </li></ul><ul><li>2, 3, 4 and 5 are forbidden, 1 is going to be prohibited in Vietnam </li></ul>
    32. 32. Factors Influenced Gold Price <ul><li>Central banks’ decisions </li></ul><ul><li>Inflation </li></ul><ul><li>Interest rates of USD, EUR </li></ul><ul><li>US economy </li></ul><ul><li>Oil price </li></ul><ul><li>Crisis </li></ul><ul><li>Demand & Supply </li></ul><ul><li>Investor’s psychology </li></ul>
    33. 33. Investor’s Psychology - Crazy for Gold <ul><li>Crazy for buying / selling gold </li></ul>
    34. 34. Investor’s Psychology - Crazy for Gold (cnt.)
    35. 35. Gold Investment Strategies <ul><li>Fundamental analysis </li></ul><ul><li>Technical analysis </li></ul><ul><li>Gold versus stocks </li></ul>
    36. 36. Risks Associated with Investing in Gold <ul><li>Market risk </li></ul><ul><li>Legal risk </li></ul><ul><ul><li>Changed policy </li></ul></ul><ul><ul><li>Foreign gold account </li></ul></ul><ul><li>Risks related to quality of gold </li></ul>
    37. 37. Gold in Eyes of Lovers
    38. 38. Lovers’ Conversation <ul><li>Male: Will you marry me? </li></ul><ul><li>Female: </li></ul>How much gold do you have?
    39. 39. Q & A
    40. 40. Preferences <ul><li>World Gold Council, http:// www.gold.org / </li></ul><ul><li>http:// www.kitko.com </li></ul><ul><li>http:// www.sjc.com.vn / </li></ul><ul><li>Saigon times http://www.thesaigontimes.vn </li></ul>

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