The victory of Syriza “is calling Germany’s bluff and forces into the open its double talk about the Eurozone,” wrote Sapir in a paper published Friday in a blog on hypotheses.org. “Yet, deprived as it is of room for manoeuver, Germany might react violently and indirectly provoke the dissolution of the Eurozone, even though it is presently its mean beneficiary.”
According to the economist, who has published several works on the challenges facing the Eurozone, the coalition between the left-wing Syriza and the right-wing populist Independent Greeks parties, far from being an ill-fitting union of convenience, is in fact a declaration of Greek sovereignty against bureaucrats in Brussels and Frankfurt, and represents “the fight for independence of Greece.”
Greece's new government, led by Prime Minister Alexei Tsipras, has made several statements which run counter to EU policy, including a clash with the EU on January 27 over a statement issued by EU heads of state calling for “further restrictive measures” against Russia.” The aforementioned statement was released without the prescribed procedure to obtain consent by the member states and particularly without ensuring the consent of Greece,” complained the Greeks in a statement, EurActiv.com reports. “Greece does not consent to this statement.”
In the economic sphere, the new administration is seeking restructuring of its €323bn ($366bn) of debt, a significant part of which it wants to be canceled. “There cannot be a solution without writing off a large part of the debt,” Tsipras told the UK's Channel 4 News in January. €240bn ($270bn) of the country's debt is the bailout it negotiated with Eurozone countries, the ECB and IMF. The Eurozone owns 60 percent of the country's debt, and so would be the hardest hit in any writing off. The ECB and IMF own six and ten percent respectively.
Therefore Germany, the economic powerhouse of the Eurozone, is according to Sapir facing “a choice between two evils,” both of which he terms as “a process of contagion.” Restructuring Greek debt would lead to similar demands from other countries who received bailouts on the condition of imposing austerity measures. However, the risk of Greece leaving the Eurozone would also risk such a “contagion” of countries leaving the single currency, damaging the interests of Germany, Europe's biggest exporter to the single market.