Determined to keep his party together ahead of an expected onslaught by MPs opposing the outlined deal, Tsipras summoned his closest allies to a meeting in Athens before a gathering of his parliamentary party on Tuesday.
Likening the deal to the 1919 Versailles treaty – widely seen as the harbinger of the second world war for its crushing of Weimar Germany – the former Greek finance minister Yanis Varoufakis called it “unviable”.
“This has nothing to do with economics. It has nothing to do with putting Greece back on the rails towards recovery,” he told Australia’s public broadcaster, the ABC.
“This is a new Versailles treaty that is haunting Europe again, and the prime minister [Alexis Tsipras] knows it. He knows he’s damned if he does and he’s damned if he doesn’t.”
Distressed at the sheer scale of the demands from Brussels, the leader of Tsipras’s coalition partner, the populist Independent Greeks, said he could not support a key element of the proposals that he described as “barbaric”.
Panos Kammenos said a demand that Athens hands over €50bn in assets from privatisations as collateral for fresh loans was a form of “confiscation” and “we cannot agree to that”.
Despite the mounting anger of many Greek politicians, world equity prices rallied at the plan to keep Greece afloat with a bailout and within the eurozone.
European stock markets surged almost 2% while Wall Street jumped more than 1% after a breakthrough came early on Monday when Donald Tusk, president of the European council, announced that the 19 eurozone leaders had unanimously reached agreement to keep Greece in the single currency, adding that Athens had signed up to “serious reforms”.
But the deal, which one EU official said came after Tsipras was “waterboarded” into submission, faces huge obstacles in the form of national parliament votes in Germany, Latvia, Slovakia and possibly France, which could all balk at the extra €86bn (£62bn) offered to Greece in loans under the terms of the bailout.
Tsipras must submit to draconian economic reforms, tougher than those the Greek people rejected in a referendum just a week before.
Controversial reforms Greece promised to pass into law by Wednesday include reforming the VAT system, overhauling pensions and signing up to plans that ensure immediate spending cuts in the event of breaching creditor-mandated budget targets.
Athens has agreed to sell off state assets worth €50bn, with the proceeds earmarked for a trust fund supervised by its creditors. Half the fund will be used to recapitalise Greek banks, while the remaining €25bn will pay down Greek debts.
But the level of hostility engendered by the accord ensured that Greece was likely to be plunged into prolonged political tumult. With foreign lenders demanding almost total surrender of the nation’s fiscal sovereignty, leading Syriza cadres spoke of the deal as the product of defeat and capitulation.
“Europe is punishing us … we can’t make this agreement seem better than it is,” snapped labour minister Panos Skourletis, predicting that fresh elections would almost certainly have to be held later this year.
In a sign of just how strained relations have become between Athens and its eurozone partners, the moderate MEP Dimitrios Papadimoulis referred to the proposed reforms as “atrocities”.
European leaders lined up to say that Grexit has been averted, gliding over the fact the eurozone had only agreed to open negotiations that could take up to four weeks to organise.
“We know time is critical for Greece, but there are no shortcuts,” said Klaus Regling, the official in charge of the European stability mechanism – the eurozone’s permanent bailout fund that Greece hopes to tap.
Politics could be overtaken by financial deadlines. Athens faces demands to repay €7bn of debts in July, including €3.5bn due to the European Central Bank on 20 July.
This will require a bridging loan of £10bn-£12bn, as the full bailout will not be agreed in time. All of the other 27 EU nations are expected to be asked to contribute. However, George Osborne immediately rejected the idea, according to Treasury officials who said Brussels was told that the £1bn of UK funds in the ESM should not be used for eurozone bailouts, in accordance with a 2010 agreement.
Tsipras did manage to win a concession that the fund should be managed from Greece, not Luxembourg, as envisaged in a German plan, but the rules will be drawn up by Greece’s creditors – the troika that Tsipras vowed to throw off, but only succeeded in renaming as “the institutions”.
Paul Krugman, the Nobel prize-winning economist and prominent critic of austerity in Greece, said the creditors’ demands on Greece “went beyond harsh into pure vindictiveness, [leading to the] complete destruction of national sovereignty [with] no hope of relief.
“It’s a grotesque betrayal of everything the European project was supposed to stand for,” he wrote several hours before the final deal emerged.
As the talks dragged on through Monday night, #ThisIsaCoup became the top trending topic on Twitter in Greece, Germany, the UK and Ireland.
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