VietNamNet Bridge – Dr Nguyen Duc Kien, Member of the
Economics Committee of the National Assembly, believes that the government and
the State Bank are following the right track when deciding to tighten the gold
and dollar trade.

Dr Nguyen Duc Kien, Member of the Economics Committee of the National Assembly

In a recent
interview with local press agencies, Kien said that the gold and dollar trade
tightening will only affect speculators, while it will in no way influence the
majority of Vietnamese people, who have low and medium incomes.

Do you know that people felt anxious
upon hearing the news about tightening the gold and dollar trade?

Who do you
mean by “people”? They must not be the seven million regular state employees,
not the 13 million workers in the fields of garment, footwear and seacooking, who
have a low monthly income of two million dong a month. I believe that the
people who feel anxious about the tightening of the gold and dollar trade do
not include tens of million farmers and millions of people who receive
retirement pensions and social allowances. As such, the people you said “feel
anxious” are just a minority. They are speculators, who surf on investments in
the gold and foreign currency markets, an activity that is not encouraged because
it causes uncertainties in the national economy.

However, it is undeniable that the
demand for gold and dollar is a legitimate demand?

I have to
affirm that to date, there has been no legal document which stipulates that the
State prohibits people from purchasing gold and dollars. The State will never
prohibit people from purchasing gold and dollars, but it requires people to buy
and sell gold and dollars at the right addresses. The main goal of the
tightening the gold and dollar trade is just to ask people to make transactions
at the authorized traders.

Have you ever gone to the
“authorized traders” -  commercial banks
- to purchase dollars?

As far as I
know, commercial banks now satisfy all the foreign currency demands from people
who need foreign currencies to study abroad or go abroad for healthcare.

How about the demand for foreign
currencies to travel abroad or visit overseas relatives?

As the
foreign currency reserves remain thin, Vietnam needs to prioritize
providing foreign currencies to businesses to serve the importation of
essential goods or input materials for local production, it is understandable
why commercial banks still cannot satisfy all the demands for foreign
currencies for traveling.

I wonder
why travelers do not use payment cards when traveling abroad. The State does
not prohibit payment cards. Is it because travelers do not want to make payment
with cards, or they do not want other people know about their expenditures in
foreign countries?

Currently, many people tend to buy
dollars to deposit at banks, but it is now really difficult to purchase
dollars?

People
always think that the local currency will depreciate. It is true that the dong
has lost some value against the dollar. However, it has not lost value against
the local currencies of other regional countries. The State Bank has followed
the right track and  prohibited commercial
banks from selling dollars to people so that people deposit dollars at banks.
The move comes in line with the policy on fighting the dollarization. The
policy has been pursued by all countries in the world, not only Vietnam.

But the demand for the dollar is a
real demand. Therefore, if people cannot buy dollars from banks, they will seek
dollars on the black market…

Why do
people want to deposit in dollars instead of dong? It is because the dollar
deposit interest rates are overly high, and much higher than the deposit
interest rates in the US,
the country that owns the dollar. It is so unreasonable. Therefore, in order to
settle the problem, it is necessary to lower the dollar deposit interest rates.

C. V