Greece may be leading indicator, not exception

GREECE's limbo will weaken Europe's recovery. The failure of the Athens Parliament to agree on the country's president will lead to new elections. That may bring left-wing Syriza to power, putting Athens at odds with its European creditors.

Europe's latest Greek crisis isn't the same as that which led to the country's 2010 and 2012 bailouts. The eurozone has a banking union, and a more activist European Central Bank (ECB) has pledged to buy a trillion euros (S$1.6 trillion) of assets. Furthermore, 90 per cent of Greece's public debt is now held by other eurozone governments or the ECB.

The upcoming elections may see Syriza, a coalition of left-wing parties, come to power. Syriza has moderated its tone recently, yet the gulf between its agenda and Greece's European creditors is vast: it wants more debt relief, looser fiscal policy, and rejects the neo-liberal economic agenda Athens had to accept as the price of its bailouts.