Vietnamese Gold Traders Eye Cambodia and Laos as Potential Markets

Strategic Insights -

Vietnamese gold trading companies are targeting Cambodia and Laos as potential markets for the gold bar trading business, driven by the sluggish domestic gold market. The State Bank of Vietnam has imposed limits on gold imports and exports, leading companies to look abroad for opportunities. Cambodia's discovery of an 8.1 million tonne gold mine has created a chance for Vietnamese businesses to purchase materials and produce internationally-standardised gold bars on the spot. With Cambodia consuming 6-7 tonnes of gold annually, and Laos also showing promise, Vietnamese gold traders see a good chance to tap into these markets.

Key Takeaways:

  • The Sacombank Jewelry Company (SBJ) opened a subsidiary in Phnom Penh with a chartered capital of $3 million and introduced its Than Tai Sacombank-branded gold bars to the Cambodian market.
  • SBJ General Director Nguyen Ngoc Que Chi sees Cambodia as a potential market with abundant gold reserves, citing the recent discovery of an 8.1 million tonne gold mine.
  • SBJ estimates Cambodia consumes 6-7 tonnes of gold each year, equivalent to one sixth of the level in the Vietnamese market.
  • The Saigon Jewelry Company (SJC) has submitted to the Government a plan to open a gold bar production facility in Laos, investing $900,000.
  • SJC plans to expand its gold bar production to Cambodia in 2011, once its plan is approved.
  • Phu Nhuan (PNJ) and Agribank (AJC) are conducting surveys in the Lao and Cambodian markets.
  • The State Bank of Vietnam - Ho Chi Minh branch director, Ho Huu Hanh, welcomed the businesses' new move, saying it is a good strategy as Laos and Cambodia are new markets with increasing gold bar consumptions.

Statistics:

  • The chartered capital of SBJ's Subsidiary in Phnom Penh is $3 million.
  • Cambodia's gold reserve is 8.1 million tonnes.
  • Cambodia consumes 6-7 tonnes of gold each year.
  • SJC plans to invest $900,000 in its gold bar production facility in Laos.
  • SJC plans to expand its gold bar production to Cambodia in 2011.

Sources:

  • "Sacombank Jewelry Company opens subsidiary in Cambodia", Asia Pulse, Aug 12
  • "Vietnamese firms plan to expand gold business to Laos and Cambodia", VNA, (no date available)
  • "State Bank of Vietnam - Ho Chi Minh branch director, Ho Huu Hanh, statement", VNA, (no date available)