INSTANT VIEW: Mugabe's party loses control of parliament

(Reuters) - Below is reaction to the Zimbabwean ruling party of President Robert Mugabe losing its control of parliament after Saturday's election:

LEON MYBURGH, SUB-SAHARA AFRICA SPECIALIST, CITIGROUP

"The fact that ZANU-PF is now a minority party is very meaningful, but of course it is subject to the presidential election, and we need to see who ultimately wins the presidential election because there is of course lots of powers rested on the president as well. This is quite a huge step forward for Zimbabwe, and it does potentially bode very well for the region.

Whoever comes into power is inheriting an economic disaster, and there's going to be some very very tough decisions that need to be made by the new government in terms of how to address hyperinflation. Unfortunately, much of the measures required may not be pleasant for the electorate. There's a number of what could be viewed as unpopular measures that the government will need to take to restore normality to the economy.

Clearly the very first challenge will be to address hyperinflation. The second challenge will be to address what they do with the currency. Thirdly, the broad investor environment... This includes issues of land ownership, mineral ownership."

SEAN MCCORMACK, U.S. STATE DEPARTMENT SPOKESMAN

McCormack said the parliamentary results showed Zimbabweans had "clearly voted for change" and he questioned why there was still a delay in announcing the presidential election outcome.

"It is our strong counsel to make known the election results immediately... There very clearly was a competitive presidential election."

MIKE DAVIES, SOUTHERN AFRICA ANALYST, EURASIA GROUP

"Because Zanu PF have conceded this, in some ways it makes them conceding the presidency less likely -- although it is clear President Mugabe's position is becoming increasingly precarious. Despite the MDC's apparent initial lead, the official presidential result will likely be engineered with votes from rural areas to either force a run-off or guarantee outright victory for Mugabe. I think the security forces are going to resist any straightforward overall handover to the MDC.

Mugabe will use the advantages of incumbency in any second-round against the opposition, although he may announce a successor to get political advantage that way."

CHRIS HART, ECONOMIST, INVESTMENT SOLUTIONS

"I think Zimbabwe now shifts from moving down a path of decline to a path of recovery and I think this particular result changes everything.

"However, a full recovery is probably only five to seven years away. But, I think the prospect of getting inflation under control is now a lot stronger especially as one of Tsvangirai's plans is to float the dollar -- leave it to market.

"You might still see a weakness of the currency but with inward investment coming in ... there will be an improvement. The indigenization bill will be thrown out of the window as a key immediate improvement measure.

"The ruling party has lost their ability to apply patronage, there is no rationale to vote for them anymore (in the second round)."