Vietnam is charting a strategic course toward establishing a national gold exchange, aiming to modernize its gold market, enhance transparency, and integrate the precious metal into the country’s broader financial system. Drawing lessons from major global trading centers, the initiative could transform gold from a traditional store of value into a critical financial asset.
Global Models Provide Roadmap for Reform
London remains the epicenter of global gold trading, handling around 70% of worldwide volume. Its tightly regulated storage system, centered around 400-ounce ‘Good Delivery’ bars, offers high transparency and reliability. London’s geographical position bridges Asian and North American markets, reinforcing its longstanding dominance. Facing increasing fragmentation, London has launched initiatives such as LMEprecious to modernize the sector by introducing derivatives, enhancing transaction efficiency, and improving market oversight.
Meanwhile, the U.S.-based COMEX exchange serves as a key platform for price discovery through its highly liquid gold futures contracts. Most trades on COMEX do not result in physical delivery, but the exchange retains close links to the physical market through mechanisms like Exchange for Physical (EFP). These tools help synchronize financial trading with physical gold flows, especially during rising activity in Asian trading hours.
China’s Shanghai Gold Exchange (SGE) offers a model of state-controlled precision. Operated under the strict supervision of the People’s Bank of China, the SGE launched the Shanghai Gold Benchmark Price in 2016 to assert influence over global pricing. While technically separate, the SGE works in alignment with the Shanghai Futures Exchange, reflecting a coordinated, multi-tiered approach that balances financial products with physical gold management.
Across Asia, markets in Dubai, Singapore, Hong Kong, India, and Japan play pivotal roles in regional gold distribution. Singapore has positioned itself as ASEAN’s gold hub, supported by liberal policies and robust financial infrastructure. Though regional centers lack the scale of London or COMEX, they provide valuable policy insights into managing domestic demand, fostering regional trade, and enhancing international competitiveness.
Traceability and Digitalisation: Foundations for Reform
A cornerstone of Vietnam’s proposed gold market reform is the introduction of a gold traceability system. This would involve digitally tagging gold throughout the supply chain—from mining and refining to retail and investment—enabling real-time oversight. Such a system should integrate with electronic invoicing and be managed by an independent supervisory authority.
To enhance investor confidence and minimize risks related to money laundering and speculation, gold should be verified and stamped by certified institutions, in line with OECD guidelines and Swiss assay standards.
The government is also exploring policies to mobilize privately held gold, much of which is accumulated informally across generations. Allowing citizens to deposit gold into banks without immediate proof of origin could unlock idle resources and support the development of gold-backed financial products. Over time, this would help stabilize supply and demand while encouraging gold-based savings, certificates, and exchange-traded funds.
Tax and Technology: Enabling Tools for Oversight
Tax policy will play a vital role in shaping Vietnam’s gold market. Import/export taxes could be adjusted to reflect global price movements and protect foreign currency reserves. Meanwhile, investment-grade gold and verified savings deposits should be exempt from taxes—even when initial traceability is incomplete. Unverifiable gold, however, may be subject to income or value-added taxes to discourage speculative trading.
A distinction must be drawn between traditional savings and speculative behavior. This will allow the government to maintain public trust while enforcing financial discipline.
Another significant step is the digitalization of gold transactions. Enabling gold ownership transfers via bank accounts—without requiring physical delivery—will promote transparency, reduce the need for physical gold, and create more flexible investment options. This requires modern infrastructure, robust risk controls, and close coordination between the State Bank of Vietnam and financial institutions.
A National Gold Reserve for Financial Security
Vietnam is also advised to enhance its national gold reserve strategy. Gold reserves offer a hedge against currency volatility and provide leverage in international markets. Following China’s model, periodic gold accumulation through official channels could ensure market stability without disrupting domestic supply.
The reserve system should be independently managed and integrated with global reporting networks to ensure transparency and maintain public trust through regular disclosures.
Toward a Regional Financial Powerhouse
The envisioned national gold exchange will not merely add another trading channel but serve as a foundational component of Vietnam’s financial ecosystem. Through a comprehensive framework encompassing traceability, digitalization, tax reform, and international-standard verification, Vietnam can transform gold into a dynamic financial instrument.
If executed effectively, the exchange will improve market governance, reduce reliance on physical trade, and position Vietnam as a credible regional hub for gold trading. Such a move would elevate Vietnam’s standing in global financial markets, enhance economic liquidity, and contribute to broader monetary stability.
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