News that the UK is putting up £7bn of the £77bn Ireland has accepted from the EU and IMF has helped reassure markets.  The Chancellor, George Osborne said: ‘It is in our national interest to help Ireland.’  Indeed their economy is closely linked to that of the UK.  They are infact the UK’s biggest trade partner and their economy is closely interlinked with Britain’s.  Lets not forget that the UK shares a land border with Ireland.

The state owned RBS is heavily exposed to the Irish banking crisis. It’s subsidiary, Ulster Bank, operates in both Northern Ireland and the Republic. It’s shares have been fluctuating since the Irish crisis began to intensify.

The UK and Ireland are often treated as one market and a number of British businesses have a strong position in Ireland.

The close relationship between the two economies was underlined earlier this month during David Cameron’s visit to China, when he pointed out that Britain exports more to Ireland than it does to Brazil, Russia, India and China combined.

Irrespective of the rights and wrongs of a single European currency – which clearly have not aided Ireland’s ability to manage their economy efficiently – the need for the UK to support the Irish government is obvious when considering the economic impact on the UK.