The opening of another bonded gold warehouse in Ho Chi Minh City is set to put a smile on the faces of domestic importers and foreign suppliers. Located near Tan Son Nhat Airport, the new warehouse will operate under a partnership between the Saigon Jewellery Company (SJC) and Brinks.
The warehouse is a major boost for the sometimes struggling gold industry
It will be used as a secure facility to store gold under customs control.
The bonded warehouse will also provide Vietnamese traders with an ‘all-in’ price for gold, including airport terminal fees, customs clearance, door-to-door transportation (insurance fees included), and other costs relating to the gold import process.
“We have seen the introduction of international gold margin trading along with the opening of the Ho Chi Minh City Gold Exchange. It is clear that Vietnam is already well-known as a gold market in Asia and that demand will be strong in the future,” said Ben Van Kerwijk, country manager of Brinks Vietnam.
According to the World Gold Council, Vietnamese demand for gold over the past three years averaged more than 70 tonnes annually.
In 2006, demand hit 86 tonnes, up 41 per cent over 2005 and is estimated to hit between 75 and 80 tonnes in 2007.
As the international gold market is price sensitive due to global political and economic conditions, local importers have been seeking ways to reduce time and risks associated with price fluctuations.
With the new warehouse, the time required to remove and transport gold will be less than 24 hours, as opposed to the two to three days at present.
“With the bonded warehouse, the import process will take a maximum of one day and all the importers have to do is submit the required documents to the warehouse’ offices and wait for their goods to arrive at their premises,” said Nguyen Huu Thuan, SJC deputy managing director.
“Local importers will no longer need to pay for any incidental fees, as SJC and Brinks will take care of these while negotiating with international gold sellers and Vietnamese customs,” he added.
With the new service, international suppliers will be able to place a large volume of gold into storage in Vietnam in order to meet demand from local importers, who will benefit from reduced gold import prices when suppliers ship large volumes.
“I hope to better support and serve local importers when delivering gold to their premises, particularly now with the continued criminal attacks on gold shops and during gold and jewellery transportation in Vietnam,” said Van Kerwijk.
In addition to gold, SJC and Brinks will offer storage for diamonds, gemstones and jewellery. It will also assist international firms who wish to come to Ho Chi Minh City to exhibit at the annual Saigon Jewellery Show.