Economic overview

The potential for the UK to leave the EU and for Greece to quit the union and the eurozone is creating uncertainty for both the individual countries and the region as a whole.

Greece’s economy is still in a delicate state and the country is running out of money to repay loans, according to Finance Minister Yanis Varoufakis. Negotiations are continuing with the eurozone over a financial package that could help the country continue its debt repayments, but Athens remains committed to its anti-austerity pledges. Unemployment in Greece is high – around 25% of its citizens are jobless, while youth unemployment is approximately 50% – and the country’s debt is around 175% of its GDP. The potential for Athens to leave the euro has major implications for the rest of the eurozone and the value of the currency.

The UK elected a Conservative government in its general election on 7 May. The Conservatives are expected to support the development of shale gas in the country, and the prospect of a market overhaul and price freeze – which the Labour Party had promised to bring in if elected – is now gone. However, the Conservatives have pledged to hold an ‘in/out’ referendum on the UK’s membership of the EU – meaning the country could leave the union. The referendum has been tentatively scheduled for 2017, although it may be brought forward. The potential ‘Brexit’ will cause continued uncertainty for the UK until the referendum takes place. If the UK does leave the EU, this will likely spark calls for another referendum on Scottish independence.