Euro zone debt crisis could affect UK recovery

| June 20, 2011 | 0 Comments
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Treasury Minister, Mark Hoban, has today said the ongoing “instability” in the euro zone could hold back the recovery of the UK economy.

While banks in the UK only have a small exposure to Greek debt compared with France and Germany, it could still have a considerable impact on the economy.

Mr Hoban was responding to questions about the Greek debt crisis today at the House of Commons and said Britain has not been asked to take part in a further bailout of Greece.

However, Chancellor George Osborne is expected to say that the UK does not want to be involved in a new financial package for Greece.

In May 2010, the EU and the International Monetary Fund (IMF) agreed a €110 billion rescue package for Greece but this has proved insufficient and ministers are meeting in Luxembourg to discuss a second bailout.

A final decision on the second bailout is expected in July. In the meantime, euro zone finance ministers have been discussing Greece’s next loan instalment of €12 billion.

Ministers met in Luxembourg yesterday but delayed their decision on the fifth instalment of Greece’s €110 billion loan until the country introduces further austerity measures.

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