European countries that still have economic problems

European countries that still have economic problems

European countries that still have economic problems

The first European Union member state that hit the bottom was Greece. The disastrous situation revealed in Greece crated panic worldwide, some even feared that this could destroy the European Union and the euro currency.

It seems that the prompt response of the European authorities and the huge loan granted to Greece helped a lot. The Greek authorities done their part of the deal and the crisis appeared to fade away.

That was not the case because other countries were added to the list of problematic members. These are Portugal, Spain, Italy and Ireland. The worst situation is currently in Ireland, the European Union taking into consideration a bail-out that can help the country to pass this difficult moment. Ireland is a very small country so the impact of its economic problems is expected to be relatively low.

On the other hand Spain is a big country with a huge economy. The most pessimist specialist fear that a crisis in Spain cannot be solved, triggering a chain reaction that could eventually lead to a disaster in the Euro zone.

All major banks in United Kingdom, including Barclays and Royal Bank of Scotland invested in Spain and it is estimated that the total exposure of Britain banks reaches around €75 billion. This huge amount of money makes the economists to fear a collapse of the Spain’s economy. If that happens, the UK’s economy will be also affected through banks.

All major countries in Europe invested in Spain through banks, so a problem there will shake things up all over Europe. The situation is almost the same in Italy’s case, but the economic predictions are not as dark. Italy still has time to straighten things up before it’s too late.

In the financial circles is speculated that the next country to get into trouble is Portugal. No one knows for sure if this speculation will come true and neither how will it affect the European Union and its member states.

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