How to stop Grexit

London

SYRIZA's resounding election victory has pushed Greece closer to quitting the eurozone. But a so-called Grexit is still not the most probable outcome, as the radical left group should be able to cut a deal with its European creditors to avoid bankruptcy - provided both sides show maturity. Alexis Tsipras, Syriza's leader, has made a host of promises that he will not be able to deliver while sticking within the constraints of the country's mega bailout programme. He wants to increase pensions and the minimum wage sharply, rehire sacked civil servants, reverse the liberalisation of the labour market and cut Athens' vast debts to other eurozone countries.

The problem is that Greece's creditors, led by Germany, are not prepared to keep lending Athens money if it does not make further progress in reforming its economy and balancing its budget. If everyone was rational, there would be scope for a compromise. After all, a large majority of Greeks want to stay in the euro. They rightly fear that quitting it might lead to a downward spiral, in which impoverishment and political strife fuel one another.