Greek elections: will Syriza victory trigger a 'Grexit'?

Syriza supporters were singing and dancing in Athens last night as the far-left party celebrated a stunning general election victory. The party won 149 seats out of 300, just two short of an absolute majority, and is now seeking a coalition partner in order to form a new administration. Voters appeared to be won over by Syriza's pledge to reject austerity and cancel Greece's billions of pounds of debt. But as Prime Minister Antonis Samaras, of the governing centre-right New Democracy party, conceded defeat, there were ripples of uncertainty across the European Union and the international markets.

So what does the win mean for austerity-ravaged Greece and could it lead to the country pulling out of the eurozone?

What does Syriza stand for?

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

The party represents an alliance of diverse left-wing splinter groups promising to negotiate more favourable bailout terms and restore social security in Greece. The party is led by the charismatic Alexis Tsipras, who rose to prominence as a mayoral candidate in Athens in 2006. At the age of 40, he has become the youngest leader in the nation's modern history. Tsipras wants to cut Greece's debt, promising a wide range of policies intended to kick start a growth-led recovery. These include raising the minimum wage by almost 50 per cent and reinstating collective bargaining.

Why is Syriza so popular?

"After years of social ruin, Syriza is offering Greeks that precious thing: hope," writes Owen Jones in The Guardian. Greece has seen the severest economic austerity in Europe over the last few years. One in four people are out of work, pensions have been cut by nearly 40 per cent and poverty has surged from 23 per cent before the economic crash to over 40 per cent in 2014. Tsipras has vowed to end Greece's "five years of humiliation and pain".

The party has made huge gains in recent years, polling at just four per cent when it first emerged. It quickly became the country's main opposition group, going on to win the European elections last year.

One of the party's main priorities will be to tackle the grip of the "oligarchs" on the country's economy and wage war against tax avoidance. Such policies have been welcomed by ordinary citizens who have borne the brunt of the country's spending cuts and tax hikes.

How has Europe reacted?

The euro has fallen to $1.11 against the US dollar, the lowest level in more than 11 years. The BBC says the result will send "shockwaves" through Europe, while raising hopes for parties that are critical of the EU. "The potential for wider revolt across Europe is expected to spook the markets as investors respond to the heightened chance of Greece defaulting on its debts and crashing out of the single currency – a scenario dubbed Grexit," says The Times. The flight of capital out of Greek banks is also likely to accelerate and Greek government bonds will be considered more risky.

Jens Weidmann, president of Germany's Bundesbank, said he hoped the new government would "not make promises it cannot keep and the country cannot afford", while Belgian finance minister Johan Van Overtveld warned that Greece "must respect the rules of monetary union". David Cameron has tweeted that the Greek election "will increase economic uncertainty across Europe" and said this is why the UK must stick to its financial plan.

Will Greece stay in the euro?

Tsipras has previously said that the party wants to see Greece in the euro on the condition that "social cohesion is not threatened". He wants to renegotiate the terms of the country's €240 billion bailout, which he claims is stifling Greece's recovery. However, opinion within the party appears to be divided, with Panagiotis Lafazanis, a senior politician, telling German newspaper Spiegel that the party wants a definite exit and a "complete break" with the "totalitarian" EU.

In the Daily Telegraph, Peter Oborne warns that nothing will be solved by Syriza's "empty promises" that the euro can be reconciled with prosperity. "Public services have decayed, the economy has collapsed and all hope is lost," he says. Tsipras is liked by the Greeks, because he "reflects the reckless national mood", says Oborne, but it is "frightening to think what lies ahead".

Syriza: the radical Greek left-wingers poised to take power

07 January

The radical opposition party Syriza is set for victory in Greece later this month, sending ripples of uncertainty across the European Union and the international markets.

A snap general election is set to be held on 25 January, triggered by the Greek parliament's failure to elect a new president last year, and analysts are predicting that Syriza will win over voters with its pledge to renegotiate the terms of the country's bailout programme.

If the party is successful, it would be the first time a radical left-wing government has assumed power in the history of the EU, claims Owen Jones in The Guardian. So what would a win mean for austerity-ravaged Greece and could it lead to the country pulling out of the eurozone?

What does the party stand for?

Syriza, which only officially became a political party in 2012, represents an alliance of diverse left-wing splinter groups promising to negotiate more favourable bailout terms and restore social security in Greece.

The party is led by the charismatic Alexis Tsipras, who rose to prominence as a mayoral candidate in Athens in 2006. If his party wins, the 40-year old will become the youngest leader in the nation's modern history.

Tsipras wants to cut Greece's debt, promising a wide range of policies intended to kick start a growth-led recovery. These include raising the minimum wage by almost 50 per cent and reinstating collective bargaining.

Why is Syriza so popular?

"After years of social ruin, Syriza is offering Greeks that precious thing: hope," writes Owen Jones. Greece has seen the severest economic austerity an in Europe over the last few years. One in four people are out of work, pensions have been cut by nearly 40 per cent and poverty has surged from 23 per cent before the economic crash to over 40 per cent in 2014.

The party has made huge gains in recent years, polling at just four per cent when it first emerged. It quickly became the country's main opposition group, going on to win the European elections last year. "The journey of Syriza from a small protest party to government-in-waiting is a political fairytale," explains Costas Douzinas in The Guardian.

If it wins the general election, one of the party's main priorities will be to tackle the "oligarchs'" grip on the country's economy and wage war against tax avoidance. Such policies have been welcomed by ordinary citizens who have borne the brunt of the country's spending cuts and tax hikes.

What will happen if they win?

Costas Lapavitsas, an economics professor at London's School of Oriental and African Studies believes the party's promises are naive and that its pledges are not possible within the confines of the union.

But the key question European leaders and investors will be asking is: will Greece stay in the eurozone, or will it pull out if Syriza secures a majority?

"Our party as a whole wants to see the country in the euro," Tsipras says, but "on the condition that social cohesion isn't threatened."

However, opinion within the party appears to be divided, with Panagiotis Lafazanis, a senior politician telling German newspaper Spiegel that the party wants a definite exit and a "complete break with the totalitarian EU".

As a result, a win by Syriza could "usher in months of uncertainty in the eurozone and even revive fears of a Greek exit from the currency union", according to the Financial Times.