Britain’s news agenda has been somewhat single-minded in the last week.

But while the ongoing saga of the phone hacking scandal has dominated the airwaves and front pages, the European economy is in a state of disarray.

The Greek debt crisis is threatening to engulf Italy and Spain, with murmurs abounding that the whole Euro could be set to crumble.

As ministers meet to thrash out a tough solution to the crisis in a continental metropolis, however, it’s hard to see what it all means for us in a rural corner of a country with a currency separate from the increasingly toxic Euro.

But, according to Shropshire experts, we should ignore the problems on the continent at our peril.

The dramatic scenes in Europe could affect every area of life at home, including disposable income levels and pensions, all the way through to jobs and house values.

Professor Mike Haynes, from the University of Wolverhampton’s business school in Telford, says: “When you are stuck at the bottom of an economic recession the last thing that you need is a major crisis in your nearest and most important export markets.

“This is the threat in the Eurozone at the moment. If the situation worsens, as it seems to be doing by the day, then Shropshire will not escape the impact.

“Businesses will be concerned about who will buy their goods if uncertainty grows and what a deeper crisis will do to investment.”

The Government has suggested that exports could be vital to dragging the economy back into health, but Mr Haynes adds: “An export led recovery was always going to be a gamble, but the Eurozone crisis makes it even less likely to come off.

“When the banks failed across the world, governments bailed them out and took on their debts. Private debt became public or what is called sovereign debt and this sovereign debt then also was pushed up by ensuing economic crisis. Now the question is can it be paid back?

“We have seen crisis in Ireland. The answer in Greece is clearly no, its economy is hanging by a thread. But such crises have a tendency to roll from country to country – it’s called contagion.

“Already in line are Italy, Spain and Portugal. It would be foolish for Eursosceptics to celebrate too much because if your neighbour’s house catches fire it doesn’t do much for yours even if the fire does not spread.

“But the fire will spread if demand for goods and services produced in the UK falls and it will if banks decide to be even tighter on lending.”

Mr Haynes adds: “At this point it might be a good idea to have a plan B. But the government has yet to change its plans. This matters because squeezing the economy in hope of a private led recovery can’t work if the conditions are not there.

“Cutting back public sector pay and jobs feeds directly into a vicious circle of falling demand and worse problems. It even ends up pushing up government debt.”

Exporters will notice the changes at first hand, but Mark Smith, regional chairman of PriceWaterhouse Cooper, says businesses at home will struggle to access finance.

While the cost of imports from the Eurozone could help mitigate against high inflation, he says domestic companies could struggle to get hold of the money needed to grow and thrive.

“If the Eurozone gets into difficulty it will impact on lending in the UK, it has to because of the exposure.

“The level of liquidity in the UK in 2006-7, when banks were falling over themselves to lend to businesses, UK banks were lending more but there was a huge influx of overseas banks providing a lot of lending. When the crisis reduced lending, the bigger impact was from overseas banks.

“That’s a secondary impact, the liquidity issue from overseas banks. You can’t see the UK in isolation because there’s interdependency in global financial markets.”

Telford shipping company Global Freight regularly moves goods across the Eurozone, and has a front-row seat to see the volatile economy.

Managing director Nicole Howarth says: “Businesses are looking for security post-recession, and the uncertainty of the markets across Europe is concerning for companies both trading with European countries and those moving goods across the region.

“We are finding that prices are volatile and our European partners are reluctant to price more than a couple of months in advance.

“That is purely down to the instability of the Euro and when the markets are unstable, businesses are nervous, which doesn’t create the right conditions for recovery either in the UK or abroad.”

She adds: “Oil prices have been rising throughout 2011 which obviously means an increase in fuel costs, but we carefully watch that situation so we can ensure we provide accurate information and costings to our customers.

“When world oil prices sank last Tuesday, the global markets slumped and in reaction to the Euro slid to a four month low.

“That kind of instability is bad for business. The dilemma for companies is how much of a risk do they take by looking to trade in Europe, when the Eurozone crisis looks like it is spreading to Italy and Spain, which are Europe’s third and fourth-largest economies respectively.”

Philippa Gee, who runs Philippa Gee Wealth Management in Church Stretton, believes the impact could also affect personal finances, partly because it will keep interest rates low.

“For those struggling to live on savings, the continuing crisis will threaten the amount of money they receive as income, putting more pressure on them to reduce their spending, particularly with other rising costs – heating being one example.

“Employment is another issue. No man is an island and no company is either, many large companies based in a particular country trade with other countries and will therefore be seriously affected. Even if there is no overseas content, companies may well be hit by nerves and need to adopt a more cautious approach to the business, with further redundancies likely.

“The anxiety is likely to spread to the housing market, with dampened house prices. So whether you want to borrow money against your home and need it valued or would look to move house, it could mean that you end up with less money.”

By Thom Kennedy