Greece standing at a strategic crossroads

In February, when Greece's new Syriza-led government reassured its lenders by agreeing to talks on its funding arrangements, the Italian economy minister Pier Carlo Padoan hailed it as proof that "the risk of a Greece outside Europe and in the orbit of Russia is moving further away".

The remark evoked cold war diplomacy more than it did a round of technical talks on euro zone financial stability, but it was a reminder that the tortuous efforts to avert a Greek default are about more than economics. Geopolitics are also at stake.

Greece's position in the eastern Mediterranean, its membership of Nato and its proximity to Russia and the Middle East give Athens disproportionate strategic significance and present Syriza with some much-needed leverage in its struggle to make its creditors ease up on austerity.

Disengagement

With western powers in a standoff with Russia over its role in

Ukraine

, divided over how to handle the flow of migrants across the Mediterranean and spooked by the rise of Islamic State in

Syria

and

Iraq

, the arguments for averting the political risks of Greek disengagement from western institutions are especially powerful, says

Michalis Spourdalakis

, dean of politics and economics at the University of Athens.

“But the negotiations [in Brussels] have proven to be so parochial – seeing everything through the keyhole of fiscal questions,” he says. “The dirty word in these negotiations is politics. They don’t want to talk about it.”

Grexit would be a "nightmare scenario" for Greece's foreign policy, says Emmanuel Karagiannis, senior lecturer at the department of defence Studies at King's College London. It would leave Greece "almost irrelevant" as a small- to medium-sized power in the region, he believes.

If Athens ends up leaving the euro zone, some in Syriza, a party that includes communists with lingering pro-Russian sympathies, would like to turn to Moscow for financial help. Greek prime minister Alexis Tsipras has made overtures himself, visiting Russian president Vladimir Putin earlier this month and denouncing European sanctions against Moscow.

Defence minister Panos Kammenos, a right-wing nationalist from Syriza's coalition partner, the Independent Greeks, has openly sought to play the Russian card to force Berlin to make concessions. "If we see that Germany remains rigid and wants to blow apart Europe, then we have the obligation to go to Plan B. Plan B is to get funding from another source," he said.

Oil prices

With Russia’s economy badly hit by sanctions and falling oil prices, it has shown little inclination to step in and bankroll Greece, says

Anton Shekhovtsov

, a Vienna-based analyst of Europe’s radical political movements. But recent meetings with Tsipras have allowed an increasingly isolated Putin to remind EU powers that he still has allies within the bloc.

"It's purely geopolitical. Greece is becoming desperate. It's very isolated within the European Union, " says Karagiannis. The two countries also have plenty to discuss. Russia's counter-sanctions against the EU have severely hit Greek agricultural exports – notably peaches, 60 per cent of which are sent to Russia. Going to Moscow gave Tsipras the chance to ask Putin for an exception for Greek farmers. "If you're prime minister of this country and . . . people have a problem surviving, you're going to go and sell those peaches to the devil," says Michalis.

In addition, there are about 150,000 dual Greek-Ukrainian citizens living in the conflict zone in eastern Ukraine, and Athens is concerned about their welfare. Energy is also on the agenda. Russia is planning a pipeline to transport its gas across the Black Sea and through Turkey; Greece would like to be its next stop.

The spectre of the West "losing" Greece to Russia is an echo of old battles. In the 1946-1949 Greek civil war, Washington funded the defeat of Soviet-backed communist insurgents, and the US supported the military dictatorship that ruled Greece from 1967 to 1974.

Today, the West has significant strategic interests in Greece. The country controls transit between the Mediterranean and Black Seas, and the US military base on Crete has played a key role in Nato interventions in the Middle East. As Syriza points out, Greece – just one border away from Islamic State-held territory – looks like a beacon of stability in a difficult neighbourhood.

Estrangement potential

So Athens’s firm footing in western institutions raises the stakes, but it also places limits on the potential for estrangement. If Tsipras’s recent overtures to Moscow are largely a pitch for business, his policy is little different from that of states such as

Italy

and

Hungary

, which also have relatively good relations with Putin’s Russia.

After all, Syriza’s rhetoric against sanctions on Moscow did not prevent it voting recently to extend those measures. “Greece is very well integrated into the western community of nations,” says Karagiannis. That will not change tomorrow.”