Tuesday, August 28, 2012

Minting a coin worth the equivalent of one-quarter of one cent

The Hondurans central bank has put out a tender call for 140 million coins, in four denominations.
Which I find puzzling. Coins are little used here. Prices are almost all rounded to the nearest lempira, with each one worth about five cents Canadian. In the big city, supermarkets sometimes give coins and on rare occasions I've received them here.
More puzzling are the denominations.
The bank wants 60 million coins in denominations of 50 and 20 centavos - roughly 2.5 cents and a penny in Canadian currency. Maybe those would be useful (though not based on my experience).
But it also wants 80 million coins of 10 and five centavos - about one-half and one-quarter cent Canadian.
All in, the coin production will likely cost something like $1.5 million.
And unless I'm missing something - which is not uncommon in my new home - it seems an odd way to spend money, especially for the low-value coins.

3 comments:

Bernard von Schulmann said...

What might interest you is that there is a good chance this contract will go to the Royal Mint of Canada.

paul said...

Bernard:
I wondered about that. A few months ago, I noticed a new story that reported a Canadian company manages the state lottery, turning exploitation of the desperate and gullible into an export. There are some Canadian mining interests - including the company that owns the mine near Campbell River - and Gildan has a big plant in the maquilla zone.

Bernard von Schulmann said...

Canadian mining is involved everywhere on the globe in early stage mining projects because Vancouver is the global centre for mineral exploration. It is so big that global mining giants with no interests in Canada let alone BC feel they need to have offices in Vancouver. Vancouver based companies want to start things, or progress them far enough, to sell out to the likes of Rio Tinto or BHP Billiton.

The Royal Mint of Canada has been making coins for some countries since the 1970s such as Panama and was a $100+ million a year business for them until recently.