Greek Prime Minister Alexis Tsipras has told a committee of key Syriza members that the party is facing a "big dilemma" – to "succumb or go ahead with a compromise we were forced into."
Syriza's central committee held an emergency meeting on Thursday to address a growing rift within the party over whether Greece should accept a third international bailout and more austerity.
Tsipras told the committee, according to Reuters reports, that without a bailout deal, Greece would have had to leave the euro zone and would be "forced into devaluation and returning to the International Monetary Fund (IMF)" for support.
The committee gathering came as Greek officials negotiate the finer details of a third bailout, which will be conditional on deep spending cuts and far-reaching reforms. Delegations from the European Commission, European Central Bank and IMF are currently in Athens to discuss the package.
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The talks with creditors come after months of wranglings between Greece and lenders over reforms. Tsipras relented earlier this month to lenders' demands for more austerity in return for a 86 billion euro ($94 billion) bailout, but the details are still under discussion. This came against a backdrop of capital controls on Greek banks, impending bankruptcy and a potential "Grexit."
When Tsipras agreed to a third bailout, he appeared to have capitulated to creditor demands that were far stricter than those initially offered to Greece at the start of bailout negotiations months beforehand. This prompted a revolt within his leftwing party, with a third of members voting against the bailout.
On Thursday, facing a continued revolt from the far-left within Syriza, which threatens to strip him of a working parliamentary majority, Tsipras was defiant.
"We will continue to battle lenders to maintain our sovereignty," he said according to Reuters, adding that pension reform and agricultural and power grid issues (sticking points with many Syriza members) remained "negotiable with lenders."
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He said that the party could not keep relying on opposition support to push through legislation on reforms and proposed a party referendum on Sunday. "We can't go on like this, we must agree to respect the decision by the majority in Syriza," he said, Reuters reported.
- By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt. Follow us on Twitter: @CNBCWorld