It appears that the Greek population may be heading to the polls again in June, as reports emerged Friday that all efforts to form a coalition government had failed.
Evangelos Venizelos, leader of Greece's socialist party, was the last of three parties to make an attempt to form a government.
Venizelos said he had failed after meeting with Alexis Tsipras, leader of the Radical Left Coalition -- a party critical of the harsh terms of Greece's international bailout agreement.
Tsipras said he would not join a government that continues to abide by the terms of the bailout package imposed by the EU and the IMF.
Party leaders have been working on forming a coalition government since Sunday's inconclusive election results.
In an interview with Â鶹´«Ã½ Channel, economic analyst Jacob Kirkegaard described the impact a new election will have on the troubled country which is currently undergoing tough austerity measures.
A new election between Greece's traditional established parties and the newer populist parties -- who oppose the terms of the bailout agreement -- would bring about a "period of acute uncertainty," he said.
And if Greece does have another election, at stake is membership in the Euro Area, said Kirkegaard.
"Basically a new election campaign will be a giant game of ‘chicken' played out between the Greek populace and the Euro Area and the entire international community, as well as the more established parties," he said.
If the parties who oppose the austerity measures do better in a June election, Greece may leave the Euro Area, he said.
"The Euro Area, especially the German government has been very clear in announcing that unless the Greek government sticks to the IMF program or something very close to it, there will be no further funding for Greece and a potential exit is the ultimate result," said Kirekegaard.
"On the other hand you have these populist parties which may end up doing better than they did last week in a new election, saying essentially ‘No we can default, we can give up on the IMF program and continue as we have been,'" he added.
If a party that rejects the IMF program is elected, the situation could quickly escalate to the point where the Greek banking system could collapse, said Kirkegaard.
This would rapidly end Greece's membership in the Euro Zone, a move that would affect economies across the entire region.
"We'll see who comes out on top," he said.
