Greek PM Tsipras in quandary as harsh reforms pit him against own party

Greek prime minister Alexis Tsipras talks to the press at the end of the Eurozone leader summit on the Greek crisis, at the European Council headquarters in Brussels, Belgium on July 13, 2015. EurozoShow more

ATHENS // European Union leaders agreed to offer Greece its third bailout in five years, conditioned on the country passing agreed reforms by Wednesday.

Greek prime minister Alexis Tsipras is now facing a formidable challenge as he prepared to force unpopular bailout reforms demanded by eurozone creditors past his own party to get them through parliament.

The 40-year-old former Communist, who stormed to power in January with promises to halt austerity, has the unenviable task of enacting what critics have called the most “humiliating” of Greece’s three bailouts since 2010.

With around a fifth of his radical left Syriza party likely to oppose him, Mr Tsipras will probably need to rely on pro-European opposition lawmakers to push through measures that will give Greece another dose of austerity.

After marathon talks in Brussels, eurozone creditors on Monday gave a green light a three-year rescue worth up to 86 billion euros, a 35-billion euro investment package, the promise of additional debt relief and — most urgently — funding for tottering Greek banks.

First, though, Mr Tsipras has to rush through parliament by Wednesday a package of tax hikes, pension reform and fiscal safeguards that are essentially the same as those that Greeks broadly rejected in a July 5 referendum.

Most controversially, Athens has to park state assets worth up to $56 billion in a special fund for them to be privatised. It will be managed by Greece under the supervision of European creditor institutions.

Mr Tsipras insisted he had fought “a righteous battle” to secure the deal. He predicted that the “great majority of Greek people will support this effort”.

But after sacrificing most of his election promises to keep the country in the euro, the novice premier’s political survival could be at stake, despite his high popularity.

“This is not what we expected, it’s a programme that won’t avoid recession, a programme of austerity, which nonetheless allows a bit of space for the government to take some initiatives and counteract the bad measures,” argued Michalis Spourdalakis, a professor of political science at the university of Athens.

“For six months Syriza has been negotiating and not governing. If we are serious about the prospect of democracy we have to give this government a chance and see how far it can go,” he added.

Labour minister Panos Skourletis, a former Tsipras spokesman, predicted on Monday that the government would lose its majority in parliament and have to hold elections later this year.

“There is now an issue of government majority (in parliament).... I see (elections) in 2015, it’s imperative,” Mr Skourletis told state TV ERT.

The Iskra website, which echoes the views of Mr Tsipras’s chief party opponent, the eurosceptic energy minister Panagiotis Lafazanis, did not pull its punches either.

“After 17 hours of ‘negotiations’, the leaders of eurozone states reached a humiliating agreement for Greece and the Greek people,” the website said.

Greece would become a “debt colony” in a “German-supervised EU,” the hardline leftist outlet said.

According to reports, Mr Tsipras is considering reshuffling his cabinet to axe Mr Lafazanis and a few other anti-euro hardliners.

The premier had already taken a beating in parliament on Saturday to get this far.

Out of the 149 Syriza lawmakers, 17 refused to support him in a Saturday vote which authorised the government to negotiate the bailout.

And among those who gave their approval, another 15 Syriza MPs said they would not approve any further reforms demanded by Greece’s creditors.

Mr Tsipras could invoke a code of conduct signed by party lawmakers which calls on them to hand over their votes to the party in the event of policy disagreement with the government.

But parliament vice-chairman Alexis Mitropoulos warned that the dissident faction was simply too influential within the party to ignore or bring to heel.

“The faction that disagrees is a co-founder of the party and the second most powerful,” the lawyer told To Vima radio.

“I don’t see these cadres backing down, and they cannot be threatened to resign,” he added.

Mr Tsipras won the authorisation vote with the support of pro-European opposition lawmakers.

* Agence France-Presse