While not a member of the European Union, Vatican City does mint EU coins. The EU has told the Vatican to more than double its annual production of coins from €1,074,000 to €2,300,000. Part of the agreement includes a stipulation that more than half the mintage should be for circulating coins, as opposed to collectors’ issues.
To facilitate this, 50-cent coins went into production recently and are now being dispensed in change at the Vatican post office, grocery, and gas station. (I didn’t know they had the latter two.)
The Vatican has relied on collector sales of stamps and coins to help finance itself. One of my readers sent me a 2-Euro coin a few years ago. It’s a treasured part of my foreign collection.
Some collectors think that multiple special issues of coins glut the market. There’s little way to amass everything–I’m thinking of the US situation. It’s nice to know that ordinary Vatican coins will get to circulate with Italian and other Euro pieces in Rome and environs. All with the image of Pope Benedict on them.
Catholic Sensibility 
Now we have a religion authorized to mint legal tender? When will we stop thinking of that fraudulent organization as a church? Read On This Rock by Dave Leonard and see what they are really all about. Yes, I know it’s fiction but it’s a good read and based on facts. Very troubling facts but facts.
The Vatican minting coins is nothing new. I+ certainly made sense when Popes were the secular rulers of large regions of Italy (after all, they commerce had to occur in those cities and towns). I would agree that continuing to issue coins is pretty superfluous any more, given the current dimensions of the Vatican City State.