BBC News

What impact would Grexit have on the UK?

By Mark Broad
Economics reporter, BBC News

image copyrightGetty Images
image captionA beach on Zakynthos, Greece - a Grexit could make the country a cheaper tourist destination

As the UK is not part of the eurozone, it has not directly contributed to bailing out Greece since the country got into trouble after the financial crisis.

The burden has been taken up by the big eurozone nations with Germany contributing £40bn and France, contributing £30bn since 2010.

The UK has provided assistance indirectly through its membership and contributions to the International Monetary Fund (IMF).

According to the think tank Open Europe, the UK has provided £1.72bn of the £37.8bn of assistance that the IMF has provided to Greece.

Raoul Ruparel, a co-director at Open Europe, thinks it is unlikely that even if Greece did leave the eurozone the UK would end up losing out on its IMF contribution.

"The IMF is the most senior creditor of all those who have lent to Greece, so would be the first to be paid back.

"I think the chances of the UK losing out are quite low," said Mr Ruparel.

Greece and the UK


contributed by the UK via the IMF


total contributed by France and Germany via the eurozone

  • Total value of UK exports to Greece in 2013 £2.82bn

  • Of total exports to the EU, that represents 1.2%

  • Total imports from Greece-UK £2.61bn



Greece is one of the UK's most popular holiday destinations with 1.73 million holiday visits by UK residents in 2014.

The Association of British Travel Agents (ABTA) says that it has not yet received calls from worried holiday makers, but has warned those planning to travel to Greece should take some precautions.

ABTA suggests that holidaymakers take extra euros in case there are problems with withdrawing cash when they arrive in the country.

It adds holidaymakers should check how much cash their travel insurance policy covers them for and should take appropriate security precautions against theft such as using their hotel safe or splitting cash up between their party.

But it adds reports on the ground suggest it is business as usual in the Greek resorts with bars, shops and restaurants adequately supplied and open as usual.

A spokesperson for Thomas Cook told the BBC that it was "closely monitoring the situation" but that so far they had not seen any drop off in bookings to Greece.

"We expect an exit from the euro would have no impact on holiday customers who have already booked with us, because we have existing contracts with hotels and airlines.

"The likely devaluation of the Greek currency could make Greece an even more attractive, great value destination for our customers," the spokesperson said.

image copyrightGetty Images
image captionTricky times ahead for UK exports to Greece - 20% are in pharmaceutical products

UK imports from Greece

•Electrical machinery and equipment 17%

•Pharmaceutical products 13%

•Vegetables, fruits and nuts 9%

UK exports to Greece

•Pharmaceutical products 20%

•Beverages & Spirits 7.6%

•Electrical machinery and equipment 7.2%


Half the UK's exports of goods and services go to Europe, with Greece making up a relatively small amount of that total.

Total UK exports of both goods and services to Greece in 2013 amounted to £2.82 billion, according to the ONS.

That represents 1.2% of UK exports to the EU, or 0.55% of UK total global exports.

Greece was the 37th largest market for UK exports in 2013, down from 34th in 2012.

The UK's main export to Greece is pharmaceutical products, with GlaxoSmithKline and Astra Zeneca being two of the biggest players.

John Longworth, director general of the British Chambers of Commerce, believes there could be tricky times ahead for British businesses if Greece were to leave the eurozone.

"With a messy Grexit looking increasingly likely, many UK businesses may be hit by the resulting market upheaval, changes in trade flows, and payment issues.

"Central banks and governments must work to limit the disruption to business through all means possible," said Mr Longworth.

image copyrightGetty Images
image captionDixons Carphone has over 100 Kotsovolos stores throughout Greece


Some of the UK's biggest companies have sizeable operations in Greece - among them Vodafone, Dixons Carphone and Unilever.

Marks and Spencer started its business in Greece in 1990 and now has 14 stores in Athens alone.

The companies have so far been reluctant to talk publically about what contingency planning they have in the event of Greece leaving the eurozone.

Sources at one company told the BBC that they had been making detailed plans to maintain trade with Greece and that the company had also been looking at how to protect staff in the event of any civil unrest.

Vodafone is one of the leading mobile providers in Greece with over 500,000 customers.

A spokesman for the group told the BBC that they were 'committed to supporting our customers now and for the next 20 years'.


Overall the UK has £7.7bn tied up in loans to Greek banks, businesses and customers.

The majority of that is in the form of exposure from UK banks, which stands at £5.3bn, according the Bank of International Settlements.

That is down considerably from the £9bn exposure UK banks had in 2009.

If Greece were to leave the eurozone there would be a complicated process to try to get this money back, especially if Greece adopted a new devalued currency.

Overall European banks have reduced their exposure to Greece by over 80% since the 2011-12 crisis, according to Huw van Steenis, a banking analyst at Morgan Stanley.

His research shows that the threat of serious contagion in the banking has reduced since the initial Greek crisis.

"The immediate first-order risk of a Greek euro exit or default on EU banks looks more manageable today," said Mr van Steenis.

Related Topics

  • Greece
  • Trade

More on this story

  • How vulnerable would new UK government be to Grexit?