Eurozone crisis brings home 'grim' warning to Midlands

Statue and ruin in Greece The Greek economy is in ruins as it faces the financial crisis

We must not delude ourselves. Just because we did not sign up to the euro does not mean we are secure against the economic mayhem causing ructions right across the European mainland.

Just ask John Spencer.

He's the boss of Lanemark of Nuneaton in Warwickshire which employs 24 people making gas-fired burners for the petrochemical industry.

His firm does business worth half a million pounds a year with trading partners in the eurozone.

And their collective trauma points towards a bitter irony for local industrialists.

"The thought of what might happen if the euro collapses is frightening: the effect on the Midlands would be bleak. It's grim," he warns.

Greek crisis

At a time when our British political leaders are exhorting business bosses to "work harder" to deliver an export-led recovery over here, the failure of their counterparts over there to solve the sovereign debt crisis threatens to choke off any prospect of growth on this side of the Channel.

Meantime Black Country Metals, based at Smethwick in the West Midlands, does 80% of its business with eurozone trading partners. It has an office in Brussels.

Sterling A strengthening pound could make it more difficult for local exporters to sell their goods abroad

So its boss, Peter Matthews, has spent the week in Greece, where he says he is continuing to buy metal but will no longer sell it in that hapless, debt-ridden country.

He tells us his suppliers there are worried about a run on the banks.

And as the international markets increasingly see sterling as a 'safe haven' in uncertain times, the prospect of a strengthening pound would make it even more difficult for local exporters to sell their goods across the water.

The effects are being felt on the high street too.

The Post Office in Birmingham says its customers are buying 80% more euros than at the same time last year.

There has been a 60% increase in transactions worth over £1,000.

So perish the thought that it's all about high finance and no concern of ours outside the rarified atmosphere of the international money markets.

Sunday guests

Peter Matthews will be giving me his own first hand assessment on the line from Greece during this weekend's Sunday Politics programme.

I will be joined in the studio by:

And I hope you will join me too, at the earlier time of 11:00 BST on Sunday, 27 May 2012 on BBC One.

Follow me on Twitter: PatrickBurnsBBC

Patrick Burns Article written by Patrick Burns Patrick Burns Political editor, Midlands

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  • rate this

    Comment number 4.

    Anyone with half a brain and one eye could see that Greece couldn't afford the euro over two years ago, keeping the status quo is destroying trade and the fortunes of ordinary people, this is for no ecconomic reason it's for saving face only, the quicker Greece leaves the euro ( in a conterolled way) the better for all.

  • rate this

    Comment number 3.

    A businessman who does a lot of trade in €uro says it'll be a disaster for us if the currency collapses and you report it unchallenged as fact rather than opinion. Typical BBC bias.

  • rate this

    Comment number 2.

    Was trade with Europe non-existent before 1992? Have we not traded with EU countries quite well over several thousand years? Is there a clause in the Treaty somewhere that says 'Thou shalt not trade with defectors, ever' ?

  • rate this

    Comment number 1.

    "Don't put all your eggs in one basket" is good business advice as well as good investment advice.
    I appreciate the difficulties but firms should seek to have a diversity of suppliers and a diversity of final markets.
    Putting 80% of your eggs in the euro basket is a high-risk export strategy.



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