An edgy dawn for Euro coin

BONN, July 7: European Union's move to launch the single currency Euro from January next had a jinxed start after a ministerial order was pa...

BONN, July 7: European Union8217;s move to launch the single currency Euro from January next had a jinxed start after a ministerial order was passed to melt about nine million new Euro coins and re-mint them afresh at a cost of nearly 330,000.

The decision, taken at a meeting of finance ministers of eleven European Union EU countries at Brussels yesterday, followed protests and complaints by blind people and vending machine operators that the 10 cent and 50 cent coins were not made according to previously agreed specifications that called for raised ridges along the edges.

The EU finance ministers were formally informed that edge milling was unfortunately the only way that many blind and elderly people would be able to distinguish between coins and that this technique appeared to be in jeopardy because of the design of the existing coins. The coins were minted in France.

The EU has to mint some 70 billion coins by 2002 when the Euro bills and coins come into circulation in 2002 in 11 countries. TheEuro, which will be divided into 100 cents and roughly equivalent to one us dolllar, is due to be introduced as a common currency for non-cash transactions from January 1, 1999.

Meanwhile, differences arose among the finance ministers over calls by the European Commission EC for tougher action on budget deficits. The commission is the executive body of the 15-nation EU.

The EC warned that governments must do more to reduce budget deficits ahead of the introduction of the Euro. The warning is being interpreted by analysts as an indication that countries may be slackening their efforts to reign in deficits while an economic revival has eased the pressure on the budgets.

Under the criteria for joining the single currency, countries cannot run up deficits of more than three per cent of Gross Domestic Product GDP. Also, as per the guidelines, any of the 11 participating Euro countries can be slapped with heavy financial penalties if they fail to meet the criteria.

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8220;I cannot hide a certain unease overthe trend in national budget deficits,8221; said EU president while adding that 8220;all too often you have a good budget deficit because of the prevailing economic situation, but we have to try to ensure that the deficit is kept structurally under control.8221;According to a EU spokesman, some finance ministers agreed that growth could be used to reduce deficits further but others said growth should be used to finance investment or a reduction in taxes.

These divergent views emerged while discussing the extent to which stronger economic growth should be used to reduce budget deficits.