The Myanmar Gold Entrepreneurs Association is pushing for a solution to the fractured local gold selling market through the introduction of a central exchange with strong rules.
The market’s aim is to standardise criteria for quality and pricing in line with international standards, while bringing all trading to one place, said association secretary U Kyaw Win, who is also owner of U Ton Gold Smith shop.
Backers intend for the gold market to start with a local focus before trying to linking with international partners later on.
“We don’t have any standard on locally-produced 24-karat gold at the moment. Nobody knows the purity of it when trading,” he said.
The association aims to change the situation for the better.
“Standardisation of everything is the main thing to implement in the market,” he said.
A number of other advances are needed to improve the local gold industry. Trademarks are important to link with the international market, he said. Taxes also needed to levied properly and the government needs to write laws and regulations, such as China does for its gold market, he added.
Insiders say the country’s gold shops are often overseen by local and regional committees, with few country-wide laws in force.
Gold exports are not allowed under existing rules. The Central Bank of Myanmar’s rules state no exports of gold, jewellery or precious stones are allowed without prior written permission.
However, U Than Tun Aung, deputy mining minister, said the current draft of the amended mining law before the Pyidaungsu Hluttaw will allow for some exports of gold and other minerals.
Allowing exports to move forward will require cooperation from organisations ranging from Customs to the Internal Revenue Department, Ministry of Mines, Ministry of Home Affairs, Central Bank and the Science and Technology Department.
“We need a secure place for exchange and secure banking process, to reach an ideal standard in price and quality,” he said. “Hopefully [Myanmar’s mineral exports] will become competitive in the market.”
The planned market will be linked with banks, ending the current practice of taking large amounts of money, said U Kyaw Win. This will help to cut down on informal trading and also counterfeits to an extent.
“Government support is the key to set this up as soon as possible,” he said. “We hope they will provide at least instructions to develop the market.”
Myanmar’s local gold price generally depends on two factors, the strength of the US dollar-Myanmar kyat exchange rate and the price of international gold.
U Kyaw Win added that local prices have climbed ahead of the November 8 election.
Gold traded at K764,000 a tical (one tical is 0.576 ounces) as of September 14, after spending most of last year under K700,000 an ounce.
Source: Myanmar Times