Greek withdrawal from the eurozone
This conjecture was given the nickname "Grexit", a portmanteau combining the English words 'Greek' and 'exit',[1][2][3] and which has been expressed in Greek as ellexodos (ελλέξοδος from Ελλάς + έξοδος (Hellas + exodos)).
Proponents of the proposal argued that leaving the euro and reintroducing the drachma would dramatically boost exports and tourism, while discouraging expensive imports, which would give the Greek economy the possibility to recover and stand on its own feet.
[1][2] On 27 January 2015, two days after an early election of the Greek parliament, Alexis Tsipras, leader of the new Syriza ("Coalition of the Radical Left") party, formed a new government.
"[26] He argues that a withdrawal from the Eurozone would give the Greek government more room for maneuver to conduct public policies propitious for long-term growth and social equity.
[27] It was drawn up in absolute secrecy by small teams totalling approximately two dozen officials at the EU Commission (Brussels), the European Central Bank (Frankfurt) and the IMF (Washington).
[27] Those officials were headed by Jörg Asmussen (ECB), Thomas Wieser (Euro working group), Poul Thomsen (IMF) and Marco Buti (European Commission).
[24] A victory for anti-bailout lawmakers in the 17 June 2012 election would likely trigger an even bigger bank run, said Dimitris Mardas, associate professor of economics at the University of Thessaloniki.
Greek authorities, Mardas predicted, would respond by imposing controls on the movement of money for as long as it takes for the panic to subside.
The first demonstration took place in Athens, Syntagma Square in June 2012 in between two major elections that brought to the country political instability and financial insecurity.
It also called for keeping the euro for small transactions and for a short period of time after the exit from the eurozone, along with a strict regime of inflation-targeting and tough fiscal rules monitored by "independent experts".
The Roger Bootle/Capital Economics plan also suggested that "key officials" should meet "in secret" one month before the exit is publicly announced, and that eurozone partners and international organisations should be informed "three days before".
The judges of the Wolfson Economics Prize found that the winning plan was the "most credible solution" to the question of a member state leaving the eurozone.
[28] IOBE head of research Aggelos Tsakanikas foresaw an increase in crime as a consequence of a Grexit, as people struggled to pay bills.
[35] Of all the political parties which won seats in the parliamentary election in May 2012, the Communist KKE expressed support for leaving both the euro and the European Union.
In February 2015, the former head of the US Federal Reserve, Alan Greenspan, said "it is just a matter of time" for Greece to withdraw from the eurozone,[41] and former United Kingdom Chancellor of the Exchequer Kenneth Clarke described it as inevitable.
[42] A leaked document revealed that, during informal discussions with one of the European leaders, then UK Prime Minister David Cameron suggested that Greece might be better off if it exited the eurozone.
[43] Richard Koo, chief economist for Nomura Research Institute, accused IMF and EU of basing their negotiation position on unrealistic assumptions.
[44] In January 2015, speculation about a Greek exit from the eurozone was revived when Michael Fuchs, deputy leader of the center-right CDU/CSU faction in the German Bundestag, was quoted on 31 December 2014: "The time when we had to rescue Greece is over.
Both German and international media widely interpreted this as the Merkel government tacitly warning Greek voters from voting for SYRIZA in the upcoming legislative election of 25 January 2015.
"[48] It has also been criticized by the German opposition party The Greens', with its speaker Simone Peter calling the debate over a Grexit "highly irresponsible".
[50] On 9 February, UK Prime Minister David Cameron chaired a meeting to discuss any possible ramifications in the event of an exit.
[55] After an emergency meeting of eurozone finance ministers (20 February 2015), European leaders agreed to extend Greece's bailout for further four months.
[56] By late June 2015 negotiations on a deal had collapsed, and Prime Minister Alexis Tsipras called a referendum for 5 July on the revised proposals from the IMF and the EU, which he said that his government would campaign against.
