Thursday

19th Oct 2017

EU considers withdrawal of 1 and 2 euro cent coins

  • Soon gone? The two-eurocent coin (Photo: Valentina Pop)

The European Commission on Tuesday (14 May) tabled several scenarios for the withdrawal of the 1 and 2 euro cent coins, with the cost of printing these coins greater than their use.

"The production of 1 and 2 cent coins is clearly a loss-making activity for the euro area with the difference between the face value of the coins and the price paid by the state to get them pointing at an estimated total cumulative loss of €1.4 billion since 2002," the commission said in a press release.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

Public opinion about the 1 and 2 euro cent coins is "rather paradoxical", says the commission, referring to various Eurobarometers. On the one hand, people seem attached to these coins and fear inflation should they to disappear. But on the other hand, they do not re-circulate them.

The commission tabled four scenarios on what to do with these coins, based on consultations with business and consumer associations, national treasuries, mints and central banks.

Under the first scenario, the coins would continue to be issued at their current cost, without altering their composition, meaning more financial losses for the eurozone. A second scenario proposes the coins to be kept, but to reduce their issuance cost by changing their composition or by increasing the efficiency of coin production.

Scenarios three and four suggest a quick or a gradual withdrawal of the coins. A quick withdrawal would be the cheapest solution, while a gradual one within 3-4 years would have less negative impact on retailers and consumers as it would give them more time to get rid of the unwanted change.

But the commission warns of inflation fears that may rise with the suppression of these coins, leading to a hike in consumer prices.

The scenarios will now be discussed with member states and the European Parliament before a decision is proposed.

"The commission does not have a preference for any one of the four scenarios at this point in time. Further discussions with all relevant stakeholders are needed on the basis of the four possible scenarios," it said.

New €5 note launched

ECB director Draghi handed out signed copies of the new €5 bank note on Thursday to a group of "euro children" who have grown up knowing only the euro.

Analysis

Juncker's euro-push could risk unity, warns eastern flank

The EU Commission chief hopes that as Emmanuel Macron pushes for euro area countries to integrate further creating a multi-speed Europe, central European members will be more inclined to join the single currency. Are they?

News in Brief

  1. EU summit moved to previous building after fumes scare
  2. Catalonia will 'not back down'
  3. New toxic incident in EU building ahead of summit
  4. Murdered Malta journalist's family invited to Parliament
  5. EU food safety chief denies keeping studies 'secret'
  6. EU states pledge 24,000 resettlement places so far
  7. US ready for arms sale to update Greece's F-16 fleet
  8. Austria's Green leaders step down following election failure

Stakeholders' Highlights

  1. EU2017EENorth Korea Leaves Europe No Choice, Says Estonian Foreign Minister Sven Mikser
  2. Mission of China to the EUZhang Ming Appointed New Ambassador of the Mission of China to the EU
  3. International Partnership for Human RightsEU Should Seek Concrete Commitments From Azerbaijan at Human Rights Dialogue
  4. European Jewish CongressEJC Calls for New Austrian Government to Exclude Extremist Freedom Party
  5. CES - Silicones EuropeIn Healthcare, Silicones Are the Frontrunner. And That's a Good Thing!
  6. EU2017EEEuropean Space Week 2017 in Tallinn from November 3-9. Register Now!
  7. European Entrepreneurs CEA-PMEMobiliseSME Exchange Programme Open Doors for 400 Companies Across Europe
  8. CECEE-Privacy Regulation – Hands off M2M Communication!
  9. ILGA-EuropeHealth4LGBTI: Reducing Health Inequalities Experienced by LGBTI People
  10. EU2017EEEHealth: A Tool for More Equal Health
  11. Mission of China to the EUChina-EU Tourism a Key Driver for Job Creation and Enhanced Competitiveness
  12. CECENon-Harmonised Homologation of Mobile Machinery Costs € 90 Million per Year

Latest News

  1. EU okays Privacy Shield's first year
  2. EU seeks to decrypt messages in new anti-terror plan
  3. EU agencies defend research ahead of glyphosate vote
  4. Spain points at elections as exit to Catalan crisis
  5. How EU can ensure Daphne Caruana Galizia's legacy survives
  6. Juncker dinner to warm up relations with eastern EU
  7. Court hearing in MEPs 'private' expenses battle
  8. The unbearable lightness of leadership