Unprecedented Gold Price Increases

Vietnam’s gold market is experiencing a period of unprecedented volatility, with prices surging to levels that have caught many by surprise. As of April 20, 2025, the Saigon Jewelry Company (SJC) listed its gold buying price at 110 million VND/tael and selling price at 114 million VND/tael. This rapid appreciation has created both opportunities and challenges for investors and borrowers alike.

The price of 99.99 gold rings and othre gold jewelry is also experiencing a similar surge, with buying prices at 195 million VND/tael and selling prices at 113.5 million VND/tael.These figures represent a significant increase compared to earlier in the week, when SJC gold bars were trading between 120 million and 120 million VND/tael, and gold rings reached 117 million VND/tael.

The Debt Trap: Borrowers Struggle with Rising Repayment Costs

The dramatic rise in gold prices has particularly impacted individuals who borrowed gold, often from relatives or friends, to finance significant purchases like homes or vehicles. The increased value of gold translates directly into higher repayment costs, placing a considerable strain on their finances.

Khan Min, a resident of Ho Chi Minh City, shared her experience of purchasing two SJC gold bars at 114 million VND/tael to repay a housing loan. While acknowledging the high price, she expressed relief at being able to settle her debt. However, many others are not so lucky.

I was really shocked when the SJC gold bargain price reached 120 million copies per nerd. I lost 5 million borrowed gold from relatives. I prepared it to reduce the burden of buying.

Khan Min, Ho Chi Minh City Resident

The rapid price increases, sometimes jumping by millions of VND within days, have left many borrowers struggling to keep up with their repayment obligations. This situation has led to increased anxiety and financial instability for those who took out gold loans.

Personal Stories of Financial strain

Hwang Nam, another resident of ho Chi Minh City, recounted purchasing a car in early 2025 when gold was priced around 85 million VND per tael. With the current price hovering around 114 million VND, his debt burden has increased substantially.

If you calculate the highest price of gold bars to 120 million buildings, you need to use about 35 million buildings to pay back the debt.

Hwang Nam, Ho Chi Minh City Resident

These personal accounts highlight the real-world consequences of the gold price surge, turning what seemed like a manageable debt into a significant financial challenge for many Vietnamese citizens.

corporate Challenges: Saigon Seafood Trade Co.,Ltd. (APT)

The impact of rising gold prices extends beyond individuals, affecting businesses as well. Saigon Seafood Trade Co., Ltd. (APT) provides a stark example of the challenges companies face when borrowing gold.

Since 2009, APT borrowed 5,833 SJC gold bars from Sacombank to bolster its operating capital. Though,the company’s inability to repay the debt,coupled with the escalating value of gold,has resulted in a ballooning debt burden. By early 2024, the total debt, including principal, interest, and overdue interest, had surpassed 1.7 trillion VND, encompassing both the original loan and the value of the gold.

Sacombank is scheduled to continue the auction for this debt on May 15, with a starting price of 317 billion VND, a significant reduction compared to previous auctions.APT’s management is reportedly in negotiations with the bank to find a resolution that ensures the company’s survival.

Economic Implications and Future Outlook

The surge in gold prices and its impact on borrowers raise broader economic concerns. While gold is often seen as a safe-haven asset, its volatility can create financial instability, particularly when used for borrowing and lending.

Experts suggest that the current situation highlights the need for greater financial literacy and caution when engaging in gold-backed loans. Additionally, regulatory measures may be necessary to mitigate the risks associated with gold price fluctuations and protect both borrowers and lenders.