Angela Merkel’s visit to Athens was short, lasting just a few hours, and it came late: The Greek debt crisis has been raging for three years now. Prime Minister Antonis Samaras greeted the German chancellor warmly, but quite predictably tens of thousands of Greeks protesting in the streets told her she wasn’t welcome. So why did she come, and what did her visit achieve?

Ms. Merkel has tied her political fate to the survival of the common currency. “If the euro fails, Europe will fail,” she keeps repeating in every speech she gives about the eurocrisis. With general elections in Germany less than a year away, the chancellor needs some progress in the solution of this crisis, but a Greek sovereign default and subsequent exit from the eurozone would be a huge setback for her.

The problem is this is still a likely scenario. After three years of countless emergency summits, two bailout packages worth €240 billion ($308 billion), and a debt write-off of 75 percent by private creditors as well as heavy cuts in public spending, Greece is still not safe.

“Greece will exit, and Merkel will be proven wrong – I’m willing to bet on it,” says Hans-Werner Sinn, president of the Munich-based Ifo Institute for Economic Research. Mr. Sinn believes that Greece would need financial support for many more years if it were to remain in the common currency – a prospect that German voters and taxpayers would see very critically. “A Greek exit would be better for all.”

The current rescue measures for Greece are scheduled to end in 2014. By 2015, the country is meant to get access to private capital again. But few believe that this can be achieved. “Greece’s sovereign debt is still extremely high,” says Jens Boysen-Hogrefe of the Kiel Institute for the World Economy. “It will be very difficult to borrow fresh money at sustainable interest rates.”

High debt rate

This year the country's debt rose to 169 percent of gross domestic product, so the country's liabilities surpassed its economic performance by two-thirds. The debt rate is expected to rise to 179 percent in 2013 and decline to 152 percent in 2017, according to the International Monetary Fund (IMF). Economists regard sovereign debts that exceed 120 percent of GDP as unsustainable.

At the same time the Greek economy keeps declining. Within the last four years it shrank by 20 percent; this year a further reduction by 6.5 percent is estimated. Without growth Greece will be unable to reduce its debts, in spite of severe cuts in public spending.

Merkel is widely perceived by Greeks as the main force behind the tough austerity measures the country has been going through in the past few years. Even though Mr. Samaras proclaimed the chancellor’s visit meant an “end to Greece’s international isolation,” it is unlikely she won over any of the protesters, given that she had warm words – “My wish is for Greece to stay in the eurozone” – but no announcements of further financial help for the Greeks.

At home Merkel has just entered the battle for reelection next year. The Social Democrats, her main opposition in Germany’s political landscape, have nominated their candidate for the chancellery, Peer Steinbrück. A former finance minister in Merkel’s first cabinet between 2005 and 2009, Mr. Steinbrück is widely credited with steering the German economy relatively unscathed through the global banking crisis of 2008.

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And Merkel faces increasing opposition to her eurozone policy within her own ranks. Alexander Dobrindt, general secretary of the CSU party, part of Merkel’s coalition government, was the latest of her allies to forecast an imminent Greek exit from the eurozone. “There is no other way,” Mr. Dobrindt told popular tabloid newspaper Bild. “Greece will exit in 2013.”

But Merkel fears the ripple effect of such an exit. “As a trained scientist, she knows a thing or two about chain reactions,” says Michael Spreng, blogger and political analyst. “She likes to be in control. And Greece has become a risk factor on her way to reelection."