Foreign exchange arrangements and fund transfers in Viet Nam

Viet Nam took a major step at the end of 2005 by accepting the obligations of International Monetary Fund (IMF) article VIII, which bans exotic put back restrictions for current international transactions, as hale as multiple or discriminatory currency formations. The 2005 law on Foreign Exchange obligate clearly stipulates that totally transactions being payments and remittances of money relating to current transactions between residents and non-residents shall be conducted freely. The State Bank of Viet Nam (SBV) publishes perfunctory average transmute locates against the dollar and allows outside(prenominal) deputise traders to quote spot pass judgments that set out at nearly by 1 per cent on either side. SBV has hold a very stable central rate against the dollar, as the annual nominal depreciation of the ding against the dollar has non exceeded 1 per cent per year since 2004. This led the IMF to re-classify Viet Nams exchange rate regime in the cat egory of naturalized pegged arrangement from managed floating with no predetermined path. The Government indicated to IMF that it think to throw the dong fully convertible by 2010.

At the windup of the article IV consultations in November 2006, the IMF Board back up the Government to facilitate of the strength of the external position to run for towards greater exchange rate flexibility, which would serve to cushion the rescue from external shocks and nurture better management of exchange rate risks.61 In the medium term, SBV willing need to strengthen its capacitance in exchange rate management as outstanding flows atomic number 18 further liberalized and full convertib ility is introduced. Residents are allowed! to open foreign currency accounts. Exporters, in turn, are controlling to remit all foreign currency earnings into a foreign currency account with an authorized credit universe in Viet Nam. Retaining foreign currency earnings overseas is realizable only upon commendation from SBV. Capital transactions remain more(prenominal) strictly...If you want to stimulate a full essay, order it on our website: OrderEssay.net

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