The development of the Vietnamese economy began with the introduction of Doi Moi, or renovation, in December 1986. The set of economic reforms aimed to develop Vietnam’s centrally planned economy into a market-driven one with a socialist orientation.

The early 1990s witnessed the first wave of foreign direct investment (FDI) into Vietnam, which pushed its GDP to 8–9% by the mid-1990s. In 1997, the currency crisis hit Asia, particularly Thailand and Indonesia, but its effects on Vietnam were less pronounced, as the country’s financial market was not open to foreign countries. The damage in Vietnam was limited to a fall in GDP, to 4% in 1999.

The local government in Ho Chi Minh City approved the manufacture of gold bars weighing in taels in 1988, of which 1 tael is almost equivalent to 37.5 grams. While other producers soon produced their imprinted gold bars, SJC gold bars were the most circulated, with more than 22 million Golden Dragon tael bars issued by SJC through several gold bar promotional campaigns, such as the Gold Accumulation Scheme and Gold Savings Box, by the late 1990s. The Vietnamese also purchased high-priced goods with SJC gold bars and listed property prices in SJC taels.

In the 2000s, foreign direct investment (FDI) flowed back into Vietnam. This pushed its GDP above 8% in 2005, a level that was maintained for three years. The growth in FDI was 8.5% and exceeded US$20 billion in 2007. This growth created a new-found appetite for investment among the Vietnamese. Gold, real estate and stocks became popular asset classes for investments.

The government abolished all administrative licensing for the management of gold trading activities in 1999, and in the following year, the State Bank of Vietnam, the country’s central bank, allowed credit institutions to mobilise gold in term deposits along with Vietnamese dong deposits guaranteed by gold. Besides that, the import of gold was permitted in 2001.

In 2005, Vietnam’s finance ministry reduced the import tax on gold bars from 1% to 0.5%, and the following year, the central bank approved margin trading on domestic and foreign gold. In 2007, the Asian Commercial Bank opened leveraged gold trading facilities, and many banks followed suit in opening similar trading facilities. However, while this increased gold imports, it also increased the country’s trade deficit.

In June 2008, the government decided to stop the import of gold. However, this created a surge in gold prices and resulted in more parallel imports. In November 2009, the government resumed gold imports, which resulted in a sharp increase in import figures and a sharp drop in reserves.