Girish Mahajan

Andorra and the euro

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Andorra and the euro

Andorra has a monetary agreement with the EU allowing it to make the euro its official currency, and permitting it to issue euro coins as early as 1 July 2013. They planned to issue their first coins by March or April 2014. On 23 December coins were delivered for pre-booked customers at the Government Administration Building, while actual circulation started on 15 January 2015.

Contents

Background

Andorra did not have an official currency prior to adopting the euro, and unlike its two larger neighbours, France and Spain, which surround it, it is not a member of the EU. However it de facto used the EU's euro (the currency of the Eurozone states) as it had historically used the French franc and Spanish peseta. When those two currencies were replaced by the euro in 2002, the euro replaced the franc and peseta as the sole circulating currency in Andorra.

Unlike the three other European microstates outside of the EU, Monaco, San Marino and the Vatican City, which adopted the euro when it was introduced, Andorra did not conclude a monetary agreement with the EU but rather used it unilaterally. These agreements gave the three microstates the right to issue their own euro coins, which have a common design on one side, and a national-specific side on the other. As with coins minted in other eurozone states, the microstate coins are valid across the eurozone; however they do not gain representation on the euro's governing bodies, the European Central Bank (ECB) and the Eurogroup. In 2003 Andorra requested that the EU conclude a monetary agreement with it which would give it the right to mint its own coins.

Currency agreements

In 2004 the Council of the European Union adopted its negotiating position with Andorra. Following Andorra's agreement to abide by Council Directive 2003/48/EC on taxation of savings income in the form of interest payments, the Commission recommended opening negotiations. Negotiations were expected to be concluded by 2008, but were repeatedly stalled due in part been to poor relations stemming from Andorra's tax haven status. A monetary agreement was eventually agreed to by Andorra and the EU in February 2011, and the agreement was signed on 30 June 2011. After the agreement came into force on 1 April 2012, the euro became Andorra's official currency. Andorra would have been permitted to issue up to 2.4 million euro coins from 1 July 2013 onwards provided that it complied with the agreement's terms.

In October 2012, Jordi Cinca, Andorra's Minister of Finance, stated that 1 January 2014 was a more likely date to start issuing euros due to delays in adopting the legislation required by the monetary agreement. In February 2013, the Director of the Mint of Andorra Jordi Puigdemasa confirmed that Andorra would not begin issuing euros until 1 January 2014. However, the EU did not approve the minting of the coins until December 2013, thus their release was delayed. Minister of Culture Stephen Albert was optimistic that the coins would be circulating by March or April 2014. By May, with still no euros issued, Cinca said that they had again been delayed but would be in circulation by the end of 2014. He cited complications from having the minting of the coins being split between the French and Spanish mints, and efforts to ensure that the coins made it into circulation, rather than to collectors, for the delay. In July, the French mint said that the coins had been minted. On 15 January 2015 the 10, 20 and 50 cent coins went into circulation.

Design

A design competition for the national side of the euro coins was launched on 19 March 2013, with a deadline of 16 April. The winning designs were announced on 16 May and depict a pyrenean chamois on the 1, 2 and 5 cent pieces, the Church of Santa Coloma and a depiction of Christ from the church Sant Martí de la Cortinada on the 10, 20, and 50 cent pieces, and Casa de la Vall on the 1 euro piece. The government had previously decided that the Coat of arms of Andorra would be featured on the 2 euro piece. Final approval of the coins is expected in late June, at which point they will be forwarded to the EU for their consent. In August, a spokesperson for Cinca confirmed that the design of the 10, 20 and 50 cent pieces had been modified to remove the depiction of Christ due to objections from the European Commission on the grounds of religious neutrality.

The 2 euro, fifty, twenty and ten euro cent coins were produced by Monnaie de Paris, while the 1 euro, five, two and one euro cent coins were manufactured at the Royal Mint of Spain.

References

Andorra and the euro Wikipedia


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