Well, the crisis is really hitting the fan in Greece and the Eurozone’s days of kicking the can down the road have come to an end.

Late Sunday, Greek Prime Minister Alexis Tsipras called off negotiations with creditors and announced he would hold a national referendum to let voters decide on whether to accept the creditors’ latest terms. With the referendum scheduled for July 5, the Bank of Greece on Monday announced that banks and markets will be closed until July 6.

This raises the probability of Athens defaulting on a 1.6 billion euro ($1.8 billion) loan repayment to the International Monetary Fund due on Tuesday.

And while it seems a bit crass to make this about us, what will happen to Asia if Greece defaults on its debt and leaves the Eurozone?

If the European Union can stop the contagion from spreading to the rest of Europe,  the effect on Asia will probably be limited.

However, a Greek exit with significant contagion effects could affect trade and create turbulence in Asia’s financial markets. This could lower gross domestic product growth in the Asia-Pacific region by 0.3% in 2016, according to Rajiv Biswas, Asia-Pacific Chief Economist for IHS Global Insight.

“However, in a more severe contagion scenario where vulnerable Eurozone countries such as Spain, Portugal and even Italy could be impacted by contagion and investor doubts about whether these countries might also eventually exit the Eurozone, the Euro could depreciate more sharply,” Biswas wrote in a Monday note. “Global financial markets could suffer more stress due to renewed uncertainty about the Eurozone outlook. In this scenario, a flight to safe haven assets could hit Asian emerging market currencies, equity markets and local bond markets as investors re-balance their portfolios to US dollars and US Treasuries.”

Biswas said the most vulnerable Asian currencies in the Greek exit scenario are the Indonesian rupiah and the Malaysian ringgit.

“Both the rupiah and ringgit have been depreciating during the first half of 2015 due to investor concerns about moderating economic growth and their current account positions,” he wrote. “Both countries also have a relatively high share of foreign ownership in their domestic stock market and local bond markets, making the rupiah and ringgit more vulnerable if global investors re-balance their portfolios to safe haven assets, notably to the US dollar and US Treasuries.”

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