Illustration: Lu Ting/GT

 
The eurozone has been looking increasingly restless lately, with the euro hitting a nine-year low thanks to concerns over Greece's possible withdrawal from the single-currency bloc.

Stoking fears of a Greek exit is the looming possibility of a victory for the radical leftist Syriza party at an election scheduled for January 25. The party's leader, Alexis Tsipras, has vowed to reverse earlier reforms and pursue debt forgiveness in the event of an election win, according to a Reuters report published Wednesday.

The party is said to be gaining popular support on a platform of scaling back the country's austerity burden as well as Greece's ballooning public debt.

Under such circumstance, should the eurozone continue efforts to balance Greece's sovereign debt? Will Greece leave the eurozone?

Such questions will be answered in due time. Until then, we can only point to the possible factors that could lead Greece to withdraw from the eurozone.

The drama playing out now resembles similar events which rocked debt-plagued nations like Greece, Spain and Portugal back in 2011 and 2012. At that time, the odds of a Greek exit seemed equally real to many observers. Some also opined that core European economies, such as Germany, would be relieved to see the struggling Mediterranean nation seek its destiny outside of the single-currency union. Nevertheless, Greece remains within the zone to this day.

An exit would give Greece more freedom to pursue its own policies vis-à-vis the European Central Bank. Yet, the country's path toward recovery could be stymied without support from the eurozone. A Greek exit may also have harmful regional consequences that European leaders are obviously motivate to avoid.

Greece entered the eurozone in 2001, becoming the currency union's 12th member. At that time, the country accounted for 2 percent of the total scale of the eurozone. Since 2009, Greece has accepted two bailouts from top European authorities and the IMF worth a total of 240 billion euro ($320 billion). According to the terms of these financial lifelines, Greece was forced to adopt a series of controversial austerity and reform measures designed to reduce its deficit. Over the years, many have blamed these policies for serious social problems, including sky-high rates of unemployment.

Yet, if critics of Greece's continued membership in the eurozone realize their dream of withdrawal, this could seriously harm the country's reputation and potentially pull it deeper into financial turmoil. On its own, Greece's currency could tumble, compounding a national debt load which is priced in euros.

Whatever course the country takes, ongoing political turmoil in Greece is undermining investors' confidence in the struggling country. Ratings agency Fitch said in late December that political uncertainties could hurt its sovereign rating. The agency has already given Greece a B credit rating, below investment grade.

Many within the eurozone are surely keen to see Greece stay where it is. The country's exit could disrupt the cohesion of the single-currency zone, while setting an unwanted precedent for other dissatisfied countries. Even top leaders in Germany - which has often been seen by pundits and politicians as Greece's reluctant creditor - have reportedly sought the Mediterranean country's continued membership in the eurozone.

Looking beyond the interests of individual states, a Greek exit could shake the euro's position as a global reserve currency. During the third quarter of 2014, the currency accounted for 22.6 percent of the world's central bank reserves, the lowest level since 2002, according to data from the IMF.

For all of Greece's trials and tribulations, it may still be in the best interests of everyone to see the country maintain its position within the framework of the eurozone. But as long as the local political climate remains unsettled, leaders and investors should prepare for any and all eventualities.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn