Grexit averted for now, but Greece faces political woes

IN A remarkable turn of events, Greece reached a deal on Monday with eurozone leaders on a new financial package, its third such bailout. The deal is extraordinary in several respects, not least because Greek Prime Minister Alexis Tsipras has signed up to an agreement that is, in numerous ways, more stringent than that which both he and the Greek populace at large, in last week's referendum, had previously roundly rejected.

The breakthrough, which follows the longest ever (17-hour) meeting of leaders of the eurozone, may now cap off a remarkable five months of brinkmanship between the Syriza-led government, elected in late January, and its creditors - the European Commission, the International Monetary Fund, and the European Central Bank (ECB). The stakes in play have been huge with President of the European Council Donald Tusk asserting last week that the crisis has been "the most critical time in our history", both for the 19-member eurozone and the wider European Union (EU) comprising 28 states.

The agreement sees Athens get a new 62 billion-euro (S$93 billion), three-year bailout package in return for significant austerity measures that Greek critics assert amount to a new "Versailles Treaty". And it has also committed to placing some 50 billion euros of Greek assets into a new fund that will contribute towards recapitalisation of country's banks, and repaying debts.