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He's back! Yanis Varoufakis to advise UK politicians

Remember Yanis Varoufakis? The Greek Marxist economist and fiery former finance minister was one of the more colorful personalities to emerge from Greece's latest euro zone crisis. Now, he's using the skills that cost him his job and brought Greece close to leaving the euro zone to help out a U.K. political party.

The leader of the U.K.'s left-wing Labour party, Jeremy Corbyn, revealed to his local London paper that Varoufakis had met with shadow chancellor John McDonnell and would advise the party "in some capacity."


Yanis Varoufakis
Milos Bicanski | Getty Images
Yanis Varoufakis

In an interview with the Islington Tribune, which is based in Corbyn's London constituency, the anti-austerity Labour leader said he was interested in Varoufakis because of his experience in Europe.

"Varoufakis is interesting, because he has obviously been through all the negotiations [with ECB, European Commission and the International Monetary Fund]. I think the way Greece has been treated is terrible and we should reach out to them."

Veteran leftwing politician Corybn unexpectedly rose to prominence last year when he became Labour leader after the party's poor performance in a general election, creating a seismic shift in the party and British politics.

Similarly, Greece's former finance minister rose to fame (or infamy) at the height of the country's financial crisis in 2015 when Greece came close to exiting the euro zone.

He was seen as the right-hand man of Greek Prime Minister Alexis Tsipras, spearheading the governing Syriza party's anti-austerity policies. For this reason, however, he riled the country's international creditors at a crucial time for Greece when it was trying to renegotiate the terms of its multi-billion euro bailout.

Varoufakis was seen as a key obstacle to progress in talks, having riled his fellow euro zone finance ministers - in particular his German counterpart Wolfgang Schaeuble.

Despite the Greek people rejecting more austerity measures from lenders in a referendum last July, Varoufakis stepped down from his role a few days afterwards following pressure from what he called Greece's "assorted partners."

In the end, as Greece faced impending bankruptcy, Tsipras conceded defeat and accept stringent austerity and reforms in return for a third bailout.

Corbyn said that although the U.K. was not in the euro zone, the party could draw inspiration from Varoufakis' opposition to spending cuts. "I realize we're not in the euro zone but it's a question of understanding how we challenge the notion that you can cut your way to prosperity when in reality you have to grow your way to prosperity."

Responding Varoufakis' new role, Chief Secretary to the Treasury Greg Hands, and member of the ruling Conservative party, said the move was a mistake.

"It tells you all you need to know about Labour's economic strategy that they are now seeking advice from former Greek finance minister Yanis Varousfakis. Jeremy Corbyn says he can learn from Varoufakis's 'experience in Europe' but that experience was one of deep recession, capital flight, banks being forced to close for days on end and a Government that struggled to pay public sector workers their wages and pensions."

- By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt. Follow CNBC International on Twitter and Facebook.