Zimbabwe opposition may sign initial talks agreement

HARARE (Reuters) - Zimbabwe's main opposition party could sign an agreement as early as Monday to begin substantive talks with President Robert Mugabe's party on ending a political impasse that has worsened the country's severe economic crisis, opposition officials said on Saturday.

The apparent breakthrough came after South African President Thabo Mbeki proposed forming a team drawn from African regional bodies and the United Nations to help him mediate the worsening crisis in neighboring Zimbabwe.

A statement seen by Reuters on Saturday said Mbeki had proposed during a meeting on Friday creating a team representing the African Union, the Southern African Development Community (SADC) and the United Nations, with which he would liaise in efforts to foster dialogue between Zimbabwe's warring parties.

The Movement for Democratic Change has refused to recognize Mugabe's overwhelming victory in a June 27 vote held after MDC candidate Morgan Tsvangirai pulled out, citing violence by ruling party militia.

The resulting impasse has dampened hopes of halting an economic meltdown that has forced the central bank to introduce a 100 billion Zimbabwe dollar note -- enough to buy two loaves of bread -- in a desperate fight against hyperinflation.

In a public letter to his supporters, Tsvangirai -- who has previously demanded that an AU envoy join the mediation before his MDC will agree to more substantial talks -- said setting up the new team was a positive step.

"We welcome (the) appointment of a reference group of eminent Africans who will work with President Mbeki and the main parties in Zimbabwe to find a peaceful negotiated solution to the Zimbabwean crisis," he said.

Opposition officials said Tsvangirai indicated to AU commission Chairman Jean Ping, who he met in Harare on Saturday, that he would be ready to sign a draft memorandum of understanding in the next few days.

TSVANGIRAI TO SIGN MOU?

The memorandum sets out guidelines on substantive negotiations between Mugabe's ZANU-PF and the opposition and as late as Thursday Tsvangirai had refused to sign it.

"Our understanding is that he (Tsvangirai) indicated to the AU guy that he is now ready to come on board, and that the MoU is likely to be signed on Monday," an official, who declined to be identified because of the sensitivity of the talks, said.

"The MDC wanted a direct AU involvement in the mediation, and we have that now ... and unless something major crops up, the signing should happen on Monday or Tuesday," he added.

There was no immediate word from Mugabe, the ruling ZANU-PF or Ping, but Ping was expected to meet with the Zimbabwean leader for discussions later.

Mbeki has been mediating preliminary talks between ZANU-PF and the MDC to resolve the stand-off but critics say he has not made progress and has favored Mugabe with his soft approach.

Tsvangirai won the first round presidential vote on March 29 but official figures showed he failed to get the absolute majority needed to avoid a second ballot. The MDC insists Tsvangirai won outright the first time.

On Saturday SADC Executive Secretary Tomaz Salomao said after a meeting of the regional grouping's foreign ministers that the inclusion of the AU and U.N. was meant to boost the Zimbabwe mediation efforts.

"They (AU and U.N. officials) are not part of the negotiation team but they will be based in Pretoria to support the efforts that we as a region are trying to undertake," Salomao told reporters in South Africa's port city of Durban.

"We are working hard, very hard ... to ensure that by the time we meet at the summit, progress can be reported to the summit," Salomao added, referring to SADC's annual summit scheduled for early August.

Zimbabweans are suffering chronic shortages of meat, maize, fuel and other basic goods because of the collapse of the once prosperous economy, which the MDC and other critics blame on Mugabe's seizure of white-owned farms and other policies.

Central bank Governor Gideon Gono said on Wednesday inflation had surpassed 2.2 million percent, but some economists say it is actually much higher.

In a notice in the official Herald newspaper on Saturday, Gono said the Reserve Bank of Zimbabwe would introduce Z$100 billion special agro-cheques (notes) to help consumers forced to carry large wads of cash even for simple transactions.

The Zimbabwe dollar, officially pegged at 30,000 to the U.S. dollar before exchange rules were relaxed recently, now trades at about 800 million to the U.S. unit.

(Additional reporting by Muchena Zigomo in Durban, editing by Stella Mapenzauswa and Mary Gabriel)

((cris.chinaka@reuters.com; +263 4 799 112-5)

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