Greek PM to take on party critics over unpopular bailout

Greek Prime Minister Alexis Tsipras on Monday set the scene for a bruising showdown with his critics by demanding a congress at his ruling Syriza party to tackle a brewing revolt over an unpopular EU-IMF bailout.

Tsipras, who remains popular with the nation but seems to be losing his grip on Syriza, said the party had to "regroup" and "clarify" its strategy.

"Collective, democratic regrouping procedures are called for. Our strategy must be clarified... The congress procedure must be set into motion as soon as possible," Tsipras told the Syriza political secretariat, according to the state agency ANA.

According to reports, the party congress is likely to be held in September.

The 40-year-old premier came to power in January pledging to eliminate austerity and wipe out most of the country's public debt.

But after five months of fruitless talks with Greece's EU-IMF creditors, who withheld loans and restricted liquidity to banks, Tsipras was forced to accept a draconian three-year bailout accompanied by new unpopular reforms.

Tsipras saw dozens of his lawmakers mutiny this month in two separate votes in parliament to approve tax hikes, a pension overhaul and administrative reforms tied to the bailout, effectively rendering his coalition a minority government.

Analysts predict that the government is unlikely to survive beyond autumn and early elections will have to be called.

Tsipras is facing a major challenge from his party's eurosceptic wing, headed by 63-year-old former senior Communist, Panagiotis Lafazanis.

Lafazanis, who was ousted as energy minister this month after publicly opposing the bailout deal, is believed to control around a third of the party.

Should a congress be held, his faction could emerge as Syriza's dominant force.

Lafazanis says the government should carry out its anti-austerity mandate, and respect the result of a July 5 referendum in which Greeks overwhelmingly rejected creditor demands for more cuts.

In a show of force, Lafazanis' faction on Monday held a rally at a central Athens sports stadium, drawing hundreds of supporters including several senior Syriza party cadres.

"This (hall) is too small to hold the great 'no' we want to say again, and say it to the end," the former minister told the crowd, which chanted 'No, No' back at him.