Measures urged to stabilise prices

HA NOI — Prime Minister Nguyen Tan Dung has called for greater implementation of measures to stabilise prices in the final months of the year.

Directive No1875/CT-TTg, released on Monday, called on ministries, agencies and municipal and provincial authorities to implement strategies to stabilise the market and boost production, in accordance with Decree No18/NQ-CP, dated April 2010. The move is designed to ensure the country's growth rate reaches 6.5 per cent, while the consumer price index does not rise above 8 per cent.

According to the leader, the economy, which typically suffers during the final months of the year, will also have to weather capital shortages, rises in the price of essential goods, power shortages and potential animal epidemics.

The directive regulates that ministries of Industry and Trade, Agriculture and Rural Development, Health, and Construction should complete and release production-development plans, as well as strategies for distributing essential goods such as petrol and gas, fertiliser, building steel, cement, foodstuffs and medicines in the fourth quarter.

The Ministry of Industry and Trade should review production capacity and supply to ensure there are sufficient quantities of goods for production and consumption from now to the first quarter of 2011.

Finance Ministry agencies are required to enhance supervision of commodity prices – particularly medicines, milk products, building materials and gas, while stabilising the price of electricity and coal sold to the cement industry and fertilisers and paper producers.

The State Bank of Viet Nam should promulgate policies that allow commercial banks to quickly withdraw money from circulation to reduce price hikes. Meanwhile, food suppliers should ensure there is enough food, particularly in cities, industrial zones, populous areas and those vulnerable to natural disasters, the directive said. — VNS

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Domestic gold prices set new record

Domestic gold prices soared on Oct. 6 to a new record of 33 million VND
per tael (1,690 USD), an increase of 1.4 million VND (72 USD) per tael
over Oct.5's price, as speculators created a run on gold shops.

A tael is equivalent to 1.2 ounces.

The gold-selling districts in Hanoi and HCM City were thronged
with people and saw prices change at least four times in the morning,
with Sai Gon Jewelry Co (SJC), Sacombank Jewelry Co, Bao Tin Minh Chau,
Agribank Jewelry Co and Phu Nhuan Jewelry Co quoting buy/sell prices at
32.85/33 million VND.

Domestic gold prices have
increased by over 24.4 percent since January, when prices stood at about
26.5 million VND (1,360 USD).

Sacombank Jewelry
general director Nguyen Ngoc Que Chi said on Oct. 6's rush of buyers was
due to a large number of speculators who had bought futures contracts
in prior months and now sought to acquire gold before the price shot up
further, putting a run on the available supply of the precious metal.

SJC's Hanoi director, Luu Quang Dien, agreed,
adding, "Many big trades are made by phone and the supply is limited, so
the company has to select familiar customers to whom to sell."

The increase made domestic gold price be 1 million VND (51.28 USD)
higher than global gold price, which ignites concerns involving gold
smuggling to take profits. Domestic price is normally just
200,000-300,000 VND higher than global price.

Rumours were rife on the gold market last week that supplies were
falling short of demand and that gold prices would continue to set new
record highs,so State Bank of Vietnam Governor Nguyen Van Giau
attempted to counter the rumours and blamed any rises in prices on
speculation rather than a gold shortage.

"With this
kind of sensitive item, our policy is not to completely ban gold
imports, but gold companies are not permitted to import any volume they
want," Giau said.

"Despite the shortage of gold at
this time, I don't think the State Bank of Vietnam will allow
enterprises to import more because of foreign exchange rates and
inflation," commented the head of a jewelry company who asked to remain
unnamed.

On the global market on Oct. 6, spot gold rose as high as 1,349.80 USD per ounce, its eighth record in the past two weeks.

The US dollar on black market on Oct. 6 also rose by 170 VND to
19,750-19,850 VND while bank exchange rates remained unchanged at 19,500
VND per dollar./.

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Domestic gold prices set new record

Domestic gold prices Wednesday soared to a new record of VND33 million per tael (US$1,690), an increase of VND1.4 million ($72) per tael over Tuesday's price, as speculators created a run on gold shops.

A tael is equivalent to 1.2 ounces.

The gold-selling districts in Ha Noi and Ho Chi Minh City were thronged with people and saw prices change at least four times in the morning, with Sai Gon Jewelry Co (SJC), Sacombank Jewelry Co, Bao Tin Minh Chau, Agribank Jewelry Co and Phu Nhuan Jewelry Co quoting buy/sell prices at VND32.85/33 million.

Domestic gold prices have increased by over 24.4 per cent since January, when prices stood at about VND26.5 million ($1,360).

Sacombank Jewelry general director Nguyen Ngoc Que Chi said yesterday's rush of buyers was due to a large number of speculators who had bought futures contracts in prior months and now sought to acquire gold before the price shot up further, putting a run on the available supply of the precious metal.

SJC's Ha Noi director, Luu Quang Dien, agreed, adding, "Many big trades are made by phone and the supply is limited, so the company has to select familiar customers to whom to sell."

The increase made domestic gold price be VND1 million ($51.28) higher than global gold price, which ignites concerns involving gold smuggling to take profits. Domestic price is normally just VND200,000-300,000 higher than global price.

Rumors were rife on the gold market last week that supplies were falling short of demand and that gold prices would continue to set new record highs, so State Bank of Viet Nam Governor Nguyen Van Giau attempted to counter the rumors and blamed any rises in prices on speculation rather than a gold shortage.

"With this kind of sensitive item, our policy is not to completely ban gold imports, but gold companies are not permitted to import any volume they want," Giau said.

"Despite the shortage of gold at this time, I don't think the State Bank of Viet Nam will allow enterprises to import more because of foreign exchange rates and inflation," commented the head of a jewelry company who asked to remain unnamed.

On the global market yesterday, spot gold rose as high as $1,349.80 per ounce, its eighth record in the past two weeks.

The US dollar on black market yesterday also rose by VND170 to VND19,750-19,850 while bank exchange rates remained unchanged at VND19,500 per dollar.

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Domestic gold prices set new record

HA NOI — Domestic gold prices soared yesterday to a new record of VND33 million per tael (US$1,690), an increase of VND1.4 million ($72) per tael over Tuesday's price, as speculators created a run on gold shops.

A tael is equivalent to 1.2 ounces.

The gold-selling districts in Ha Noi and HCM City were thronged with people and saw prices change at least four times in the morning, with Sai Gon Jewelry Co (SJC), Sacombank Jewelry Co, Bao Tin Minh Chau, Agribank Jewelry Co and Phu Nhuan Jewelry Co quoting buy/sell prices at VND32.85/33 million.

Domestic gold prices have increased by over 24.4 per cent since January, when prices stood at about VND26.5 million ($1,360).

Sacombank Jewelry general director Nguyen Ngoc Que Chi said yesterday's rush of buyers was due to a large number of speculators who had bought futures contracts in prior months and now sought to acquire gold before the price shot up further, putting a run on the available supply of the precious metal.

SJC's Ha Noi director, Luu Quang Dien, agreed, adding, "Many big trades are made by phone and the supply is limited, so the company has to select familiar customers to whom to sell."

The increase made domestic gold price be VND1 million ($51.28) higher than global gold price, which ignites concerns involving gold smuggling to take profits. Domestic price is normally just VND200,000-300,000 higher than global price.

Rumours were rife on the gold market last week that supplies were falling short of demand and that gold prices would continue to set new record highs,so State Bank of Viet Nam Governor Nguyen Van Giau attempted to counter the rumours and blamed any rises in prices on speculation rather than a gold shortage.

"With this kind of sensitive item, our policy is not to completely ban gold imports, but gold companies are not permitted to import any volume they want," Giau said.

"Despite the shortage of gold at this time, I don't think the State Bank of Viet Nam will allow enterprises to import more because of foreign exchange rates and inflation," commented the head of a jewelry company who asked to remain unnamed.

On the global market yesterday, spot gold rose as high as $1,349.80 per ounce, its eighth record in the past two weeks.

The US dollar on black market yesterday also rose by VND170 to VND19,750-19,850 while bank exchange rates remained unchanged at VND19,500 per dollar. — VNS

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Speculators cause domestic gold hike

The price of gold on the local market has risen due to possible speculation rather than a supply shortage, according to Nguyen Van Giau, governor of the State Bank of Vietnam (SBV).

The global gold price set new records in the past few days, as did the domestic gold market.

The SBV and the Vietnam Gold Association had kept a close watch on the market in the last few days, and discovered there was no shortage of gold, Giau said, adding that speculation was possibly the cause for the price rise.

Domestic gold prices in August and the first half of September were lower than the world price. But currently the domestic price is VND400,000 per tael higher than the global price.

The SBV was working with other agencies, including the police and market management, to discover the reasons behind the price hikes.

"With this kind of sensitive item, our policy is not to completely ban gold imports, but gold companies are not permitted to import any volume they want," Giau said.

"We are establishing a management framework for gold trading and imports so that it is suitable with a market economy. We will collect ideas from ministries and industries when we complete it."

Nguyen The Hung, general director of the Vietnam Gold Investment and Trading Co, said the gold price on the domestic market would be equal or even lower than the world price if the SBV permitted gold importers to import gold.

However, the government has stopped granting permits for gold imports, which indicates that it no longer considers gold an essential item, according to an expert.

In addition, the higher gold price had not affected people's lives since few people conducted their transactions in gold, he said.

The gold price on the domestic market on Thursday morning fell to VND31.15 million (US$1,597) per tael (1.2 ounces) after it reached a record of more than VND31.3 million ($1,605 USD) per tael on Wednesday, following an upward trend in global gold prices.

On Thursday morning, SBJ gold was also bought and sold at VND31.15 million ($1,597) and VND31.18 million ($1,599) per tael, respectively.

Sai Gon Jewelry Holding Co on the same day bought the precious metal at VND31.14 million and sold it at VND31.18 million VND per tael, a reduction of 130,000 – 170,000 VND against Wednesday.

Most gold shops in Ho Chi Minh City Wednesday raised their price by more than VND700,000 ($21.3) over the previous day’s price to VND31.25-31.36 million per tael.

The global gold price on that day reached an all-time high of $1,313 an ounce on speculation that a global economic recovery would stoke inflation. In Asia, the metal slightly fell to $1,309 an ounce in the morning.

The weakening of the US dollar on the world market has also contributed to the gold price hike, analysts have said.

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Speculators cause domestic gold hike

The price of gold on the local market has risen due to possible speculation rather than a supply shortage, according to Nguyen Van Giau, governor of the State Bank of Vietnam (SBV).

The global gold price set new records in the past few days, as did the domestic gold market.

The SBV and the Vietnam Gold Association had kept a close watch on the market in the last few days, and discovered there was no shortage of gold, Giau said, adding that speculation was possibly the cause for the price rise.

Domestic gold prices in August and the first half of September were lower than the world price. But currently the domestic price is VND400,000 per tael higher than the global price.

The SBV was working with other agencies, including the police and market management, to discover the reasons behind the price hikes.

"With this kind of sensitive item, our policy is not to completely ban gold imports, but gold companies are not permitted to import any volume they want," Giau said.

"We are establishing a management framework for gold trading and imports so that it is suitable with a market economy. We will collect ideas from ministries and industries when we complete it."

Nguyen The Hung, general director of the Vietnam Gold Investment and Trading Co, said the gold price on the domestic market would be equal or even lower than the world price if the SBV permitted gold importers to import gold.

However, the government has stopped granting permits for gold imports, which indicates that it no longer considers gold an essential item, according to an expert.

In addition, the higher gold price had not affected people's lives since few people conducted their transactions in gold, he said.

The gold price on the domestic market on Thursday morning fell to VND31.15 million (US$1,597) per tael (1.2 ounces) after it reached a record of more than VND31.3 million ($1,605 USD) per tael on Wednesday, following an upward trend in global gold prices.

On Thursday morning, SBJ gold was also bought and sold at VND31.15 million ($1,597) and VND31.18 million ($1,599) per tael, respectively.

Sai Gon Jewelry Holding Co on the same day bought the precious metal at VND31.14 million and sold it at VND31.18 million VND per tael, a reduction of 130,000 – 170,000 VND against Wednesday.

Most gold shops in Ho Chi Minh City Wednesday raised their price by more than VND700,000 ($21.3) over the previous day’s price to VND31.25-31.36 million per tael.

The global gold price on that day reached an all-time high of $1,313 an ounce on speculation that a global economic recovery would stoke inflation. In Asia, the metal slightly fell to $1,309 an ounce in the morning.

The weakening of the US dollar on the world market has also contributed to the gold price hike, analysts have said.

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Speculators cause domestic gold hike

The price of gold on the local market has risen due to possible
speculation rather than a supply shortage, according to Nguyen Van Giau,
governor of the State Bank of Vietnam (SBV).

The global gold price set new records in the past few days, as did the domestic gold market.

The SBV and the Vietnam Gold Association had kept a close watch on the
market in the last few days, and discovered there was no shortage of
gold, Giau said, adding that speculation was possibly the cause for the
price rise.

Domestic gold prices in August and the
first half of September were lower than the world price. But currently
the domestic price is 400,000 VND per tael higher than the global price.

The SBV was working with other agencies, including
the police and market management, to discover the reasons behind the
price hikes.

"With this kind of sensitive item, our
policy is not to completely ban gold imports, but gold companies are not
permitted to import any volume they want," Giau said.

"We are establishing a management framework for gold trading and
imports so that it is suitable with a market economy. We will collect
ideas from ministries and industries when we complete it."

Nguyen The Hung, general director of the Vietnam Gold Investment and
Trading Company, said the gold price on the domestic market would be
equal or even lower than the world price if the SBV permitted gold
importers to import gold.

However, the Government
has stopped granting permits for gold imports, which indicates that it
no longer considers gold an essential item, according to an expert.

In addition, the higher gold price had not affected people's lives
since few people conducted their transactions in gold, he said.

The gold price on the domestic market on Sept. 30 morning fell to
31.15 million VND (1,597 USD) per tael (1.2 ounces) after it reached a
record of more than 31.3 million VND (1,605 USD) per tael on Sept. 29,
following an upward trend in global gold prices.

On
Sept. 29, most gold shops in HCM City raised their price by more
than 700,000 VND (21.3 USD) over the Sept. 28 price to 31.25-31.36
million VND per tael.

On Sept. 30 morning, SBJ gold
was buying and selling at 31.15 million VND (1,597 USD) and 31.18
million VND (1,599 USD) per tael, respectively.

Sai
Gon Jewellery Holding Co on Sept. 30 bought the precious metal at 31.14
million VND and sold it at 31.18 million VND per tael, a reduction of
130,000 – 170,000 VND against Sept. 29.

The global
gold price on Sept. 29 reached an all-time high of 1,313 USD an ounce on
speculation that a global economic recovery would stoke inflation.

In Asia , the metal slightly fell on Sept. 30 morning to 1,309 USD an ounce.

The weakening of the US dollar on the world market has also contributed to the gold price hike, analysts have said./.

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Target to hold prices and curb power cuts

HA NOI — The Government will instruct relevant agencies to carry out synchronous measures to control prices, while overcoming power shortages, Prime Minister Nguyen Tan Dung said at the Government's regular monthly meeting yesterday.

Participants at the meeting were told that the Prime Minister would soon issue an instruction on price controls in an attempt to stabilise the market up to early 2011.

Dung said a nationwide conference would be held on implementing the instruction in a bid to fulfil this year's socio-economic targets, such as controlling inflation.

He stressed the need to maintain a stable prime rate, to manage the monetary system in an active but flexible way and to keep the price of essential commodities and medicines stable.

The Prime Minister asked ministries, cities and provinces to reserve enough goods to serve public demand during the lunar new year celebrations.

In an attempt to overcome power shortages, Dung urged electricity suppliers – particularly the Electricity of Viet Nam – to take drastic measures to speed up the construction of power plants, while buying electricity from neighbouring countries and cutting down on waste.

Participants at the meeting heard that the socio-economic situation had developed positively in the first nine months of this year. The economy had recovered fairly quickly after the global downturn and performed better than the same period in 2008 and 2009.

Specifically, the gross domestic product growth averaged 6.52 per cent in the first nine months, while industrial production was higher than the whole year's plan.

Export turnover was about US$51.5 billion in the first nine months, an increase of 23 per cent compared with the same period last year and four times higher than the National Assembly's approved target of over 6 per cent.

Total import turnover was $60 billion, an increase of 22 per cent compared with the same period last year. The trade deficit continued to narrow down and stood at $8.5 billion – equal to 16.7 per cent of the total export turnover.

The consumer price index rose 8.64 per cent compared with the same period last year.

Despite much progress, the economy was still facing many difficulties, the conference heard.

The price of consumer goods had increased, as had the price of gold. The sluggish performance of some major world economies continued to affect the country's export growth.

Production and trading enterprises were still finding it difficult to borrow money because of high interest rates, the Prime Minister said. Making matters worse, the country also has to cope with natural disasters such as typhoons, flooding and epidemics.

To overcome these difficulties, the Government has asked ministries, industries, cities and provinces to ensure there are enough supplies of commodities and that prices are stable, while disbursing investment capital for projects using Government bonds and the State budget.

The meeting reviewed socio-economic development in the first nine months and discussed strategies for the remainder of 2010. — VNS

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Speculators cause domestic gold hike

HCM CITY — The price of gold on the local market has risen due to possible speculation rather than a supply shortage, according to Nguyen Van Giau, governor of the State Bank of Viet Nam (SBV).

The global gold price set new records in the past few days, as did the domestic gold market.

The SBV and the Viet Nam Gold Association had kept a close watch on the market in the last few days, and discovered there was no shortage of gold, Giau said, adding that speculation was possibly the cause for the price rise.

Domestic gold prices in August and the first half of September were lower than the world price. But currently the domestic price is VND400,000 per tael higher than the global price.

The SBV was working with other agencies, including the police and market management, to discover the reasons behind the price hikes.

"With this kind of sensitive item, our policy is not to completely ban gold imports, but gold companies are not permitted to import any volume they want," Giau said.

"We are establishing a management framework for gold trading and imports so that it is suitable with a market economy. We will collect ideas from ministries and industries when we complete it."

Nguyen The Hung, general director of the Viet Nam Gold Investment and Trading Company, said the gold price on the domestic market would be equal or even lower than the world price if the SBV permitted gold importers to import gold.

However, the Government has stopped granting permits for gold imports, which indicates that it no longer considers gold an essential item, according to an expert.

In addition, the higher gold price had not affected people's lives since few people conducted their transactions in gold, he said.

Prices

The gold price on the domestic market yesterday morning fell to VND31.15 million (US$1,597) per tael (1.2 ounces) after it reached a record of more than VND31.3 million ($1,605) per tael on Wednesday, following an upward trend in global gold prices.

On Wednesday, most gold shops in HCM City raised their price by more than VND700,000 ($21.3) over the Tuesday price to VND31.25-31.36 million per tael.

Yesterday morning, SBJ gold was buying and selling at VND31.15 million ($1,597) and VND31.18 million ($1,599) per tael, respectively.

Sai Gon Jewellery Holding Co yesterday bought the precious metal at VND31.14 million and sold it at VND31.18 million per tael, a reduction of VND130,000 – VND170,000 against Wednesday.

The global gold price on Wednesday reached an all-time high of $1,313 an ounce on speculation that a global economic recovery would stoke inflation.

In Asia, the metal slightly fell yesterday morning to $1,309 an ounce.

The weakening of the US dollar on the world market has also contributed to the gold price hike, analysts have said. — VNS

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Gold price surges on high demand

SJC gold is still the benchmark for bullion trade in Vietnam. The local gold price hit new record of VND30.74 million per tael on Monday - Photo: Le Toan

HCMC – Local gold prices on Monday continued hitting new records on higher demand as Saigon Jewelry Holding Co. (SJC) quoted selling price at VND30.74 million per tael, increasing VND280,000 per tael from late last week.

Ton The Vinh Quyen, sales director of Sacombank Jewelry Co., said on Monday morning alone the company sold 3,000 taels while the buying volume was modest. A tael equals to 1.2 toy ounces.

Crowds of gold buyers made local gold prices suddenly increase on Monday morning while global prices rose slightly. Buying here eased in the afternoon.

Quyen said if the global gold price exceeds the level of US$1,300 an ounce, it would continue rising in the future. However, he expected the gold price to decline after the consecutive record highs in recent days.

Nguyen Cong Tuong, deputy head of sales at SJC, said the trading volume of the company on Monday was much higher than late last week. He said the buyers were mainly investors who borrowed gold from banks to sell in the past and now had to buy gold again to cut losses.

Meanwhile, Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewelry Co. (PNJ), said as gold demand increased, gold traders had to compete with each other for sources, making a shortage in short term and pushing the price up.

Local gold price is about VND200,000 higher than global price. Cuc said given the difference, enterprises did not want to import gold, but her company had sent an import proposal to the central bank to import immediately when the price is higher.

Gold was traded at US$1,297.3 an ounce by 5:00 pm on Monday on European market, rising US$0.3 an ounce from late last week.

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Gold price surges on high demand

SJC gold is still the benchmark for bullion trade in Vietnam. The local gold price hit new record of VND30.74 million per tael on Monday - Photo: Le Toan

HCMC – Local gold prices on Monday continued hitting new records on higher demand as Saigon Jewelry Holding Co. (SJC) quoted selling price at VND30.74 million per tael, increasing VND280,000 per tael from late last week.

Ton The Vinh Quyen, sales director of Sacombank Jewelry Co., said on Monday morning alone the company sold 3,000 taels while the buying volume was modest. A tael equals to 1.2 toy ounces.

Crowds of gold buyers made local gold prices suddenly increase on Monday morning while global prices rose slightly. Buying here eased in the afternoon.

Quyen said if the global gold price exceeds the level of US$1,300 an ounce, it would continue rising in the future. However, he expected the gold price to decline after the consecutive record highs in recent days.

Nguyen Cong Tuong, deputy head of sales at SJC, said the trading volume of the company on Monday was much higher than late last week. He said the buyers were mainly investors who borrowed gold from banks to sell in the past and now had to buy gold again to cut losses.

Meanwhile, Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewelry Co. (PNJ), said as gold demand increased, gold traders had to compete with each other for sources, making a shortage in short term and pushing the price up.

Local gold price is about VND200,000 higher than global price. Cuc said given the difference, enterprises did not want to import gold, but her company had sent an import proposal to the central bank to import immediately when the price is higher.

Gold was traded at US$1,297.3 an ounce by 5:00 pm on Monday on European market, rising US$0.3 an ounce from late last week.

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NA to review draft price management law

LCD TVs on display in Ha Noi. A draft price management law will be submitted to the National Assembly next year, according to Nguyen Tien Thoa, director of the Ministry of Finance's Price Management Department. — VNS Photo Truong Vi

HA NOI —A draft price management law will be submitted to the National Assembly next year, according to Nguyen Tien Thoa, director of the Ministry of Finance's Price Management Department.

Under the law, the price of goods and services will be dictated by the market, with oversight from the State.

The State would act to stabilise prices indirectly through macroeconomic policies to control supply and demand of goods and services, Thoa said.

He added that the State would retain the power to intervene directly to control the price of some goods, public services and to curb the actions of monopolies.

The State would switch from fixing prices to allowing market forces to decide, Thoa said.

"The move is considered a drastic departure when it comes to the management of prices in particular and the management of the economy in general," he said.

Thoa added that the State would also ensure that social welfare policies were in place to help the disadvantaged.

Circular 122

In anticipation of the move, the Ministry of Finance issued Circular No 122/2010/TT-BTC to amend Circular No 104/2008/TT-BTC that was issued two years ago.

The circular will officially take effect on October 1. From this date, firms will only have to register prices with local authorities once. However, local authorities must be notified when prices change.

"Before issuing the new circular, the ministry has consulted relevant State bodies, foreign experts, businesses and consumers. Almost all of them supported the circular," said Nguyen Anh Tuan, deputy director of the department.

Under the circular, if companies raise or decrease the price of essential goods and services unreasonably, concerned bodies are authorised to take action.

Among the goods covered by the circular are milk powder for children under six, coal, schoolbooks, printing paper, cement, steel, fertiliser and salt.

Individuals and organisations that produce or trade goods stipulated in the circular must register prices with relevant State offices. If prices or fees being registered are considered unjustifiable, local authorities will ask firms to adjust them according to the cost of input materials, transportation fees, among other things.

Under earlier rules, action was only taken if firms raised the price of essential commodities by 20 per cent or more within a 15-day period.

Some foreign experts and businesses have claimed that the circular contravened Viet Nam's commitments to the World Trade Organisation.

However, Tuan said: "We reviewed all our commitments, especially under Article 96 to 103 and came to the conclusion that none of the regulations in the circular violates WTO's rules."

If the circular was widely considered to be unreasonable, the department would submit recommendations it deems worthwhile to the ministry for consideration, Tuan said.

Stricter fines

Under a newly completed draft decree, stiffer fines will be imposed on firms that break price regulations.

According to the draft regulation, firms that sell goods or charge fees higher than registered face a fine of VND2-VND5 million (US$102.6-$256.4).

If they fail to report price changes with the relevant offices, they face a fine of VND15-VND20 million. Firms that fail to register goods' prices or service fees from the outset face a fine of VND20-VND30 million.

Furthermore, if firms take advantage of goods' shortages to hike prices or speculate on regulated commodities, they face a fine of VND35 million or more.

If companies fail to properly adhere to local authority price guidelines, they face a fine of between VND30-VND40 million. — VNS

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Construction price index fails to reflect market fluctuations

HA NOI — Construction firms are complaining that they are being put at a disadvantage by the Ministry of Construction because its quarterly price reports do not reflect monthly market movements.

The issue was raised during a seminar organised by the ministry this week.

Those at the meeting said the ministry should publish its research monthly so that firms could more accurately assess their costs and charges.

Lam Van Hoang, from the Ministry of Transport's Project Management Unit No2, said quotes were based on projected figures, which themselves were calculated on official price-fluctuation forecasts. Because of monthly market fluctuations, particularly during the 2004-08 period, construction firms say they have been losing out.

Wang Gui Jun, of Ha Noi-based China State Construction Engineering Corporation, said it was virtually meaningless to publish the construction price index on a quarterly basis.

The time between purchasing and the publication of the price index could be very significant, Wang said.

He added that the price index should protect the interest of contractors.

Ngo The Vinh, from the Institute of Construction Economy, said steel prices had risen from VND11-VND16 million ( (US$564-$820,512) per tonne in a 40-day period. Every two or three days the price of steel rose by VND200,000 to VND300,000 per tonne which had a major impact on construction, he said.

To make the index more effective, Tran Dang Luyen, from the Department of Construction Management at the Ministry of Agriculture and Rural Development, said the construction price index needed to be published monthly.

He also said the index should be applied to all 63 provinces and cities instead of 12 regions. — VNS

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Dairy price control does not violate WTO rules: official

A new regulation requiring price registration of imported milk powder products for children does not break any WTO commitments, an official said, rejecting concerns expressed by dairy firms and foreign ambassadors.

The regulation, which comes into effect next month, is also in accordance with a previous government decree that lists milk as one of the commodities whose prices must be kept stable, Nguyen Tien Thoa, head of the Price Management Department at the Ministry of Finance, was quoted by the Vietnam News Agency as saying.

His statement came in response to recent comments from foreign milk companies and five ambassadors of Australia, Canada, New Zealand, the US and EU.

In a joint letter, the ambassadors said the new price control effort will affect Vietnam’s commitments as a WTO member. They also warned that it could also hinder foreign investment.

The Ministry of Finance said the new regulation aims to exert some control over milk prices in Vietnam

Current regulations require only companies with 50 percent state capital to register their prices with the authorities. Starting next month all imported milk powder products for children under six must have their prices registered with the authorities.

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Milk circular ‘doesn't break WTO rules'

HA NOI — A new Ministry of Finance regulation on powdered milk price increases does not violate Viet Nam's commitments to the World Trade Organisation (WTO), said the director of the ministry's Price Management Department, Nguyen Tien Thoa.

Circular 122/2010/TT-BTC strictly adhered to Government Decree No 75/2008/ND-CP of June 9, 2008, which defined milk as a commodity in need of price stabilisation, said Thoa. The new regulation would amend the earlier Circular No 104 to prevent unreasonable price hikes of imported powdered milk.

The ministry has not promulgated any new policies, Thoa stressed.

Circular No 122, which takes effect on October 1, stipulates that importers and distributors must register and report the prices of powdered milk products for children under six years of age to the price management agency.

The ministry issued its explanation in response to several foreign-invested dairy distributors and the ambassadors of Australia, Canada, New Zealand, the US and the European Commission.

In a common letter addressed to the ministry, the ambassadors said the new price control mechanism would interfere with Viet Nam's efforts to achieve a market economy as well as its compliance with WTO regulations.

It could also hamper the attraction of foreign investment and development of the labour market, the diplomats said. — VNS

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Official rejects VN’s violations of WTO price policy

The Finance Ministry’s Circular 122/2010/TT-BTC does not break any of
Vietnam's price commitments to the World Trade Organisation (WTO),
said an official.

Director of the ministry’s Price
Management Department Nguyen Tien Thoa said the document strictly
adheres to the Government’s Decree 75/2008/ND-CP of June 9, 2008, which
defines milk as a commodity whose prices should be stabilised. It amends
and supplements earlier Circular 104 in order to prevent unreasonable
price hike of imported powdered milk.

The Finance Ministry did not promulgate any new policy, Thoa stressed.

Circular 122, which will take effect as of October 1, stipulates that
importers and traders must register and report prices of powdered milk
for under six-year-old children to the price management agency.

The Finance Ministry’s explanation followed feedbacks from several
foreign-invested milk trading companies and the Ambassadors of
Australia, Canada , New Zealand , the US and the European Union.

In a common letter addressed to the ministry, the
ambassadors said the new price control mechanism would affect Vietnam
’s efforts towards a market economy as well as its performance of WTO
regulations.

It could also hamper the attraction of foreign investment and development of the labour market, the diplomats said./.

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Gold rises to new record high

A customer buys gold jewelry at a shop of SJC. The gold price yesterday shot up to a new high of VND29.49 million per tael - Photo: Thuy Linh

HCMC – Local gold on Wednesday hit an all-time high of VND29.49 million per tael, up VND240,000 from the previous day, as global gold markets rallied.

The domestic price once jumped to VND29.5 trillion on Wednesday. A tael equals to 1.2 troy ounces. Despite the rally, gold companies said trade was as usual.

Nguyen Cong Tuong, deputy head of the sales department of Saigon Jewelry Holdings Co. (SJC), said demand surged early on Wednesday as the opening price was much lower than the world price, so some companies grasped this opportunity to export gold to enjoy a small margin of about VND50,000 per tael after tax and fee.

However, around an hour later local gold changed direction and moved up to a level almost equaling the global price, so buying energy got muted, he added.

SJC revised the price about 12 times on Wednesday as the yellow inched up non-stop from the morning to 3 p.m., then turned to decline. The gold trading house on Wednesday bought a total of 1,500 taels and sold 2,500 taels.

At Phu Nhuan Jewelry Co. (PNJ), buying and selling were quite balanced. Nguyen Thi Cuc, deputy general director of the company, said her company bought 1,400 gold taels and sold 1,200 taels by 5 p.m. on Wednesday.

Gold was traded on the European market by 6 p.m. on Wednesday at US$1,259.6, causing the local price to surge to over VND29.47 (fee and tax excluded).

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Dairy firms push up prices while they can

Dairy consumers have been angered as some producers jump to increase their prices before a new pricing law takes effect next month.

Under Circular No 122 that applies from October 1, dairy firms must register the price of milk for infants under six with the Ministry of Finance's Price Management Department or the provincial departments of finance. The agreed price would be calculated from the cost of materials and production.

Since the end of last month, some milk brands have increased prices by as much as 10 percent to get in before the new law that aims to stabilise the price of dehydrated children's milk and prevent unreasonable price hikes, Lao Dong (Labour) reports.

For instance, Abbot has adjusted prices on three of its products by 7 percent.

Anmum brand put its price up by 10 percent a few days ago. The price of Abbot's Ensure Gold for adults has jumped by 8 percent to VND470,000 (US$24.7) each 900g tin.

Milk shops on Nguyen Thong Street , district 3, said within a week Abbot's Pediasure brand would also have a price adjustment.

Nguyen Thi Hanh, general director of Sai Gon Co.op, said among the dozens of imported powered milk brands, only Mead Johnson had made a commitment not to boost prices.

For domestic dairy firms, only Hancofood has confirmed not to alter its price tag.

The dairy firms blamed the price increases on high production costs brought on by higher material costs and the changed USD/VND exchange rate.

Experts said, however, that dairy firms spent too much on advertising and sales commissions and passed the added cost to the consumers.

A woman shopping for milk, Thuy Oanh, on Nguyen Du street, Go Vap District was concerned that the circular only applied to powdered milk for six-year-olds so she expected price increases for milk for pregnant women and the elderly.

Apart from the regulations, the Consumer Right Protection Association needs to coordinate with retailers and boycott milk brands that always increase their prices

 

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Dairy firms push up prices while they can

Dairy consumers have been angered as some producers jump to increase
their prices before a new pricing law takes effect next month.

Under Circular No 122 that applies from October 1, dairy firms must
register the price of milk for infants under six with the Ministry of
Finance's Price Management Department or the provincial departments of
finance. The agreed price would be calculated from the cost of materials
and production.

Since the end of last month, some
milk brands have increased prices by as much as 10 percent to get in
before the new law that aims to stabilise the price of dehydrated
children's milk and prevent unreasonable price hikes, Lao Dong (Labour)
reports.

For instance, Abbot has adjusted prices on three of its products by 7 percent.

Anmum brand put its price up by 10 percent a few days ago. The price
of Abbot's Ensure Gold for adults has jumped by 8 percent to 470,000 VND
(24.7 USD) each 900g tin.

Milk shops on Nguyen
Thong Street , district 3, said within a week Abbot's Pediasure brand
would also have a price adjustment.

Nguyen Thi Hanh,
general director of Sai Gon Co.op, said among the dozens of imported
powered milk brands, only Mead Johnson had made a commitment not to
boost prices.

For domestic dairy firms, only Hancofood has confirmed not to alter its price tag.

The dairy firms blamed the price increases on high production costs
brought on by higher material costs and the changed USD/VND exchange
rate.

Experts said, however, that dairy firms spent
too much on advertising and sales commissions and passed the added cost
to the consumers.

A woman shopping for milk, Thuy
Oanh, on Nguyen Du street , Go Vap District was concerned that the
circular only applied to powdered milk for six-year-olds so she expected
price increases for milk for pregnant women and the elderly.

Apart from the regulations, the Consumer Right Protection Association
needs to coordinate with retailers and boycott milk brands that always
increase their prices./.

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Spiraling cost of import pulp pushes up paper price

HCMC – The price of paper products on the local market is expected to rise by 10%, because of the increasing price of imported pulp.

Cao Tien Vi, member of the Vietnam Pulp and Paper Association (VPPA), told the Daily that as the industry was still importing almost all the pulp needed for paper production, the increasing price of the imported pulp would mean a 10% rise in paper costs by the year-end.

He said the imported pulp was still very high at some US$700 per ton, nearly 50% more than the average price in recent years.

“The supplies for pulp materials in the world markets are down because of some recent forest fires, so I think the price of imported pulp will keep increasing,” Vi said.

At the moment, Vietnam’s paper industry is importing pulp from Brazil, Russia, Canada and Indonesia.

Vi said the consumption of domestically produced paper had declined with more competition with imported products.

“This has been causing difficulties for local paper producers,” he said.

At the moment, the country is trying to reduce paper imports and increase exports of its own products but without much success because of quality and price problems.

Vietnam produces 1.5 million tons each year, compared to demand of over two million tons.

The imports of paper products into Vietnam could fall because of the 2% devaluation of the dong against the U.S. dollar, Vi said.

The country depends totally on imports for some special papers such as packing paper, decorative paper and cardboard for boxes.

According to VPPA, 35% of local paper enterprises are still small producers with outdated technology that wastes energy and water and causes pollution.

The industry would have difficulty updating technology without more support from government, Vi added.

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