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Gold and gold bullion were two of the items referred to by the law. According to the existing regulations, people were allowed to keep and transfer them, said Nguyen Quang Huy, director of the Foreign Exchange Department under the State Bank of Vietnam (SBV).
"Under Resolution 11 issued on February 24, the government requested the SBV to submit a draft decree on bullion trading in attempt to control gold imports, with the aim of eliminating bullion trading on the open market and preventing cross-border gold smuggling in the next quarter.
The new decree will replace government Decree 174/1999/ND-CP, but possession of gold bars will continue to be legal," he said.
"In terms of the right to hold foreign currency, Amendment 24 to the Foreign Exchange Ordinance issued by the National Assembly in December 2005 states that individuals that have foreign currency in cash have the right to keep the foreign currency, sell it to licenced credit institutions and use it for other legal purposes."
Vietnamese citizens were also allowed to deposit foreign currency at licenced commercial banks, withdraw it and receive interest on such foreign currency, he affirmed.
After one week of the SBV's crackdown on the open market, exporters have sold more foreign currency to commercial banks. As a result, banking foreign currency liquidity has improved significantly while the forex rate has become more stable.
Simultaneously, the Ministry of Public Security has been implementing drastic measures to control illegal forex activities, bringing to a halt black market forex operations. This has had a drastic effect on people who are used to accessing foreign currency on the black market.
Cao Van Thuy, general director of Tocontap company told the Vietnam Economy newspaper that the drastic measures had been necessary for forex stability, the economy and businesses, adding that it made it easier for enterprises to access banks' foreign currencies sources while allowing them to lower service fees for the purchase of foreign currencies.
According to existing regulations, individuals in need of foreign currency for travel, studies or medical treatment abroad can buy it at licenced commercial banks. Banks then will decide how much foreign currency they are prepared to sell based on their reserves.
However, since the open market for foreign exchange market has been closed, many individuals have complained that they can't purchase foreign currency to spend abroad.
Liem Tran, director of Hoang Nam Limited Company, was planning to visit the US, but said that since the black market had been closed, he could not purchase US dollars for his travel purposes.
He visited several commercial banks to purchase foreign currency, but the banks refused to sell US dollars to him, due to a lack of availability.
An official from the Bank for Foreign Trade of Vietnam said although the price of the US dollar against the Vietnamese dong on the open market had declined, and that most of that market had been shut down, banks did not have foreign currency reserves available to sell to individuals.
Another reason was that cash forex transactions had caused banks higher expenditure in the import-export of foreign currency, inventory and savings. Therefore, several banks had been reluctant to sell foreign currency in cash to individuals, Huy said.
Regarding individual demand for foreign currency, the SBV is considering several measures to make it easier for individuals to purchase foreign currencies in cash at reasonable prices from commercial banks in an effort to eliminate the black market while creating favourable conditions for commercial banks to carry out the task.
On March 12, the SBV's governor Nguyen Van Giau sent a request asking commercial banks to sell foreign currencies to individuals who required it.
Huy also suggested that a good way for individuals in need of foreign currency to spend abroad was to use international debit and credit cards. Vietnam has a large banking system that connects with organisations that issue international debit and credit cards.