Greeks overwhelmingly voted against their international creditors’ conditions for further bailout aid, in a result that could deepen the rift between Greece and the rest of Europe and push the country closer to bankruptcy and an exit from the euro.More than 61% of Greeks voted “no” in Sunday’s referendum on austerity measures and other overhauls that European and International Monetary Fund officials had demanded in recent talks—an outcome that spurred popular celebrations into the night across downtown Athens and other Greek cities.The victory was perhaps sweeter than what left-wing alliance Syriza and Greek Prime Minister Alexis Tsipras had anticipated. The ramifications of the referendum on a country facing a severe economic and fiscal crisis have yet to have been fully exposed. Some have already been felt inside Greece. Greece’s finance minister Yanis Varoufakis, known for being particularly harsh towards international creditors, has resigned. The leader of the Greek opposition has resigned too. The finance minister’s resignation is going to be critical in indicating what the Greek government intends to do. With Varoufakis stepping away, the Greek government is expected to put a softer – maybe more palatable – figure in his place. The aim of the referendum was not to step away from the EU and euro, but to put pressure on Greece’s international creditors. Greece still needs emergency loan assistance from the European Central Bank to keep its banks afloat. With the ECB set to decide on the emergency loan, these few days are critical for the future of Greece and the EU. The Greek government also reconstituted its negotiating team for another round of talks with its creditors. In the days to come, some may well ask whether or not Pakistan ought to also engage in similar brinksmanship. Of course, we are not at such a crisis point at the moment, but the underlying realities can change fast in this country, as the financial crisis of November 2008 made clear. Before any wrong lessons are derived from the events in Greece, it is worth noting a few things about the drama there. First, the world is growing weary of arranging repeated bailouts, as evidenced by the willingness of Greece’s creditors to walk up to this precipice, even if they are not willing to go over the edge at this point. Second, the immense strength that it took for the Syriza party to face down its creditors came from its close connection with the electorate, something that nobody in our political arena enjoys.When facing pressure in any form from the international community, Pakistan’s strength has almost always come from its geopolitical endowments rather than the credibility of its institutions. These are weak foundations upon which to build our standing in the world community. They are likely to deplete faster than durable institutions. And finally, it is worth bearing in mind that the present mess in Greece is ultimately the result of profound mis-governance by the generation that came before the current youthful leadership of Syriza.
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