Greek challenge will put eurozone's crisis strategy to the test

WHETHER the European Union (EU) lenders and the International Monetary Fund (IMF) like it or not, they are in for a tough time over Greece's debt crisis.

The new Syriza-led government is determined to get either a substantial write-off of the country's 323 billion euro (S$496 billion) debt or a renegotiation of the terms of the loans so that repayments don't kick in until the Greek economy starts growing again. As well, a rescheduling of repayments is almost a certainty. Athens's debts amount to 175 per cent of its gross domestic product.

The person leading the talks with the IMF and Brussels is the new finance minister, Yanis Varoufakis. It is not for nothing that this former academic describes himself as a "libertarian Marxist". His tome on the 2008 financial crisis, The Global Minotaur: America, Europe and the Future of the Global Economy, argues that the global financial system is both unbalanced and unsustainable.