Home Business Investment Economic Import-Export Real Estate Stock Bank Directory Banking News Financial Gold Trade Health Agriculture Education

Advertisements

Random Post

Vietnam Financial News

Vietnam Business » Vietnam Financial News » Gold and dollar prices escalating, no one benefits

Gold and dollar prices escalating, no one benefits

The Japanese yen has also appreciated against the dong. At 8:20 am, the yen price was quoted at 246.63 - 253.99 dong per yen, an increase of three dong per yen in comparison with the weeks opening price. The euro is now trading at 28,101.00 dong per euro.

The gold and dollar prices have been increasing continuously, threatening businesses. Especially, the weaker dong does not benefit exporters, even making their business worse.

At 9:45 am of November 9, the gold price jumped to 38.2 million dong per tael, increasing by 2.5 million dong per tael compared with the opening prices (one tael is equal to 1.2 oz). Meanwhile the dollar price soared to 21,250 dong per dollar, the highest level so far.

In principle, the dollar appreciation will benefit exporters, because the weak local currency will make domestic products cheaper, thus more competitive in the world market. But in fact, export companies are now like cats on hot bricks.

Tran Quoc Manh, Chair and General Director of Sadaco, said the dollar price increases have pushed the prices of input materials, transport fees and labour costs high up.

Manh admitted that the company has earned more money thanks to the dollar appreciation, but the profit is not big enough to cover the higher production costs. Especially, Sadaco, like many other producers in Vietnam, have to import input materials to make final? products in Vietnam. Therefore, they now have to pay more money for the import materials due to the more expensive dollar. Manh stressed that when policy makers think of the monetary solutions to encourage exports, they should consider of the fact that Vietnamese producers have to pay for imported input materials in dollars.

Besides, export companies complain that though they sell foreign currencies to banks, when they need money to make payment for material imports, they cannot buy foreign currencies from banks at the prices at which they had sold themto banks before.

Nguyen Thi Cuc, Deputy General Director of Phu Nhuan Jewellery Company (PNJ) said in September, her company earned $300 million from gold exports and sold the sum to banks. However, her company now cannot buy dollars from banks at the quoted prices.

"The banks, though admitting that PNJ is a loyal client who should get priority in dollar purchases, still refuse to sell dollars to us, saying that they cannot sellat such low prices," Cuc complained.

In fact, banks still have dollars to sell, but at the prices set by banks, not the prices quoted by clients.

Le Dang Minh, Managing Director of Gimeno, a fashion company, said that he has just bought dollars from a bank. Though the quoted price was 19,500 dong per dollar, in fact, Minh had to pay 20,100 dong per dollar. Minh said that he still does not know how to "legalise" the gap of 600 dong per dollar. As the input materials cost 70 percent of the values of his products, the dollar price increases have made the company suffer losses.

However, Minh believes that those who suffer the most now are labourers, whose salaries do not increase in proportion with increases in the goods prices.

Minh does not think that export companies deliberately refuse to sell dollars to banks, thus causing the dollar shortage. He said that only the companies which have profuse capital can keep dollars on their accounts. Meanwhile, small companies like his have to sell dollars to banks right after they earn the money, because they need money to continue production.

Vietnam Business And Financial News Network. Source [english.vietnamnet.vn]

More Vietnam Financial News:

Popular Vietnam Business News

Vietcombank H1 Pretax Profit of VND2,450B Meets 75 per cent of Year's Target

The Joint Stock Bank for Foreign Trade of Vietnam (VCB) made pretax profit of VND2,450 billion in the first half this year, fulfilling 75 per cent of its yearly target,

Bank For Agricultural Of Ho Chi Minh City

These are some of the leading stories in the official Vietnamese press on Tuesday. Reuters has not verified these stories. -- Partly private Dong A Bank said it made a

PetroVietnam Asked to Rebuild Financial Plan for Dung Quat Refinery

The US$3.1-billion refinery has to date produced gasoline A92, kerosene, diesel oil, and liquefied petroleum gas (LPG) for the market. The plant had sold a total of 5,630 tons of

Sheraton set for Nha Trang market entry

The Sheraton Nha Trang, located in the central coastal city of Khanh Hoa Province, will host its soft opening on March 19 to welcome both business and leisure travellers. The

Dana - Italy Steel JSC applies for listing shares on northern bourse

Hanoi Stock Exchange (HNX) announced to receive application profile for listing 15 million shares of Dana - Italy Steel Joint Stock Co on March 19, 2010. The company with chartered

Low-income Apartment Segment Attracts Investors

While the apartment block segment has not yet seen recovery; low-cost houses are attracting speculators attention, which has helped to form a sudden price hike in realty in the west

Vietnam garment exports set to rise as industry holds line on prices

Viet Nams garment industry has a worldwide reputation for making competitively priced and high quality garments, a survey conducted by the US-based non-profit group Kearny Alliance has found.

Vienam eeal estate developers race to build skyscrapers

Thirty-seven, sixty-eight, seventy, even 102 storeys - in Hanoi and Ho Chi Minh City, bigger and bigger buildings are reshaping the skyline. Most skyscraper projects have been developed by heavyweights

Advertisement