Vietnam central bank makes U-turn on ban on gifting of foreign money

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The State Bank of Vietnam said Wednesday it has changed its mind about a proposed ban on people gifting foreign money after the plan evoked fierce criticism from many quarters.

The bank said in a statement that since the 2005 Foreign Exchange Ordinance allows people to open bank accounts in foreign currencies, it is "reasonable" that they use that foreign money to make gifts.

The ban was in a draft decree the central bank announced a few days ago to solicit public opinion.

The proposed decree will be submitted to the government, and, if approved, will supersede decree No.160 which guides the 2005 Foreign Exchange Ordinance.

But many economists questioned the proposal's legality and feasibility, pointing out it would violate people's rights since many Vietnamese have a habit of gifting foreign money during Tet (the Lunar New Year), believing that currencies like US$2 bills bring good luck.  

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They also feared that the ban would affect the legal flow of foreign remittances, saying a past regulation banning people from receiving remittances in foreign exchange saw the proliferation of illegal remittances.

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