State Bank of Vietnam on April 22 shrugged off rumors of a possible change of currency from the present Vietnam dong to a totally new currency.
Nguyen Chi Thanh, head of the Treasury Department of the State Bank, said these rumors may have originated from a proposal laid out to change the name of the country under a constitutional amendment, for which opinions are being gathered from various quarters.
The State Bank also rejected the issuing of new bank notes in nominal denomination of one million dong.
Thanh said that a currency change would adversely affect the economy at present. For this, the State Bank will have to first stock large volumes of paper currency, equivalent to the current cash flow in circulation at present.
The current volume of cash in circulation is very high at present in Vietnam, and to issue the same amount will take a few years. The currency change will also be a very high expense burden, said Thanh.
According to the State Bank, as of now the value of the Vietnam dong is quite stable and also functional. The State Bank therefore has no intention to change the currency nor will it issue new one million dong bills.