The Greek economic crisis may affect the Eurozone first, with France and Germany set to lose a vast amount of money if Greece defaults, but there will be considerable damage done to the United Kingdom as well. Just because the United Kingdom is not in the Eurozone it does not mean to say we would be free from the pressures that an unmanaged Greek default would bring. Although France and Germany has the biggest stake in Greek banks, The United Kingdom is in a big way exposed to Greek debt, with the United Kingdom's three largest banks offering assistance, through the IMF, in the first bail out last May.
Although Greek, French and German banks would be hit the hardest, banks from the United Kingdom would not be free from crisis. Barclays, HSBC and RBS have a combined total of £2.3 billion invested in the first bail out. If Greece was to default in an unmanaged way, the banks would lose that money. It is important to point out that banks with the most exposure to Greek debt are not the ones who have the most money invested. The UK's banks would be under severe pressure if an unmanaged default was allowed to happen.
The United Kingdom is the third most exposed economy to Greek debt, behind France and Germany. We have a total of £14.6 billion invested in the country with the vast majority of that from banks and private lenders. If Greece defaults the problems could well spread to Portugal and the Republic of Ireland - a country that the UK has a larger investment in. If the problems hit the Republic of Ireland after widespread economic crisis in Greece, a further bail would not be offered to Ireland and the Irish economy would default. The UK would lose a vast sum of money. So without a doubt, un unmanaged Greek default could have spiralling and ultimately crippling consequences of the UK economy.
Furthermore, the Eurozone is the United Kingdom's trading partners. We may not be in the Eurozone but we do have a vast amount invested in trade. There is no benefit to the United Kingdom for any of the big European economies to face economic hardship like that of 2008, nor will it be advantageous for the Euro to collapse. Putting it simply, whatever happens in the Eurozone effects Britain in a big way? A strong Eurozone will result in a strong United Kingdom.
Problems in the Eurozone affect its entire membership and the UK's economy would be not be an exception. However, there is quiet relief that the United Kingdom did not join the single currency. The Republic of Ireland found out this to its considerable costs. Interest's rates are set to suit the interests of Europe's largest economy - Germany. As a result the one size fits all policy does not fit for the smaller economies and when tough times hit, it is Greece, Ireland and Portugal that are hit. The UK economy is not, to the same extent, at the mercy of the German economy but all Eurozone problems in some way affect Britain.