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Mythbust

Britain didn’t bail out Greece

by Sam Ashworth-Hayes | 25.04.2016

Myth: Britain was forced to pay for last July’s Greek bailout

InFact: Greece did receive a loan from an EU fund, the European Financial Stabilisation Mechanism. But the UK was never on the hook for any payments.

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A deal was done which meant that non-eurozone members would be fully compensated in the event that Greece did not repay its loan. They were provided with collateral to guarantee this. In the event, Greece repaid its loan without incident.

What’s more, a law was passed at the time ensuring the same treatment if a similar situation arose in future. The UK’s renegotiation of its EU membership in February 2016 gave further protection against Britain being drawn into euro zone bailouts. The deal made the following commitment: “Emergency and crisis measures designed to safeguard the financial stability of the euro area will not entail budgetary responsibility for Member States whose currency is not the euro.”

This article is an adaptation of a piece that previously appeared on InFacts

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Edited by Hugo Dixon