Europe is facing daunting challenges as it battles its debt crisis but the continent will pull through and the eurozone will stay intact, says Byron Wien, vice-chairman of Blackstone Advisory Partners.

Greece is growing closer to exiting the eurozone.

The country elects a new parliament on June 17 and despite gains in the polls by a conservative political party that wants to stick with the euro, enough leftwing politicians who favor rejecting austerity measures tied to bailout funding could garner a good portion of the votes as well.

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Letting Greece go would be a disaster, and Europe will work to avoid it.

"Europe is on the verge of getting better," Wien tells FinanceAsia.

Still, it won't be easy.

Greece and Portugal will have to work to stay in, and not take membership for granted.

"I think that although efforts will be made to keep them in, they’ve got to do more themselves if they are to endure," Wien tells Business Spectator separately.

Turning to the larger Italy and Spain, a closer look shows that their fundamentals aren't as bad as in Athens, marked by notably larger export platforms.

"Spain and Italy have viable economies and they’re able to export products that people want to buy. So I think that Spain and Italy are salvageable. I’m not sure that that’s the case for Greece and Portugal.”

About a decade ago, Argentina defaulted on its debts and devalued its currency, a similar fate facing Greece should it exit the currency zone.

Despite initial pain, Argentina's economy rebounded on exports made cheaper by devaluation, such as beef, grains and wine, among many others.
Greece, Wien says, cannot go that route and would be better off trying to stick with the euro.

"What are they going to compete on? Olive oil and tourism?”

If Greece did ditch the euro, "all the banks would go bankrupt, depositors would see the value of their savings cut in half. I don’t think they have the means to drag their way out."

Overall, however, the outlook for the global economy looks bright.

"The European Union will survive, the euro will survive, China will have a soft landing and the U.S. economy will be stronger in the second half than what it was in the second quarter — it will be more like it was in the first quarter," Wien says.

"Markets will do better."

The conservative Greek political party New Democracy has watched its popularity rise in the polls ahead of June 17 parliamentary elections, followed by the more radical Syriza, which has staunchly voiced opposition to austerity measures, Reuters reports.

Some polls show New Democracy garnering enough votes to team up with its socialist ally PASOK and patch together a coalition government.

Elections held on May 6 saw Syriza gain ground, and its politicians refused to negotiate with other political parties to form a coalition government, thus resulting in the June 17 ballot to end the standoff.

New Democracy head Antonis Samaras has stepped up attacks on Syriza, accusing the party of threatening to ditch austerity without telling Greeks what a move would mean — a messy exit from the eurozone and an economy in shambles.

"If Greece unilaterally rejects the bailout deal it will be isolated for years ... It will have no food, no drugs, no fuel. It will have to live with permanent power cuts," Samaras told party supporters at a rally, Reuters adds.

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