Mugabe hands key ministries to own party, angers MDC

By MacDonald Dzirutwe

HARARE (Reuters) - Zimbabwean President Robert Mugabe has allocated three important government ministries to his ZANU-PF party, angering the opposition and threatening a power-sharing deal.

A government notice on Saturday showed Mugabe had allocated to his party the ministries for defense, home affairs -- which is in charge of the police -- and finance, a crucial portfolio for the resuscitation of Zimbabwe's devastated economy.

Mugabe and main opposition Movement for Democratic Change (MDC) leader Morgan Tsvangirai have been deadlocked over how to share key ministries and have agreed to call in Thabo Mbeki, the former South African president, to mediate the crisis.

Mbeki's spokesman said he would travel to Harare on Monday.

The cabinet impasse has outraged Zimbabweans who had hoped a September 15 power-sharing agreement would end an economic meltdown.

MDC spokesman Nelson Chamisa said the opposition had not agreed to the allocation. "This is ZANU-PF's arrogant wish list that puts the whole deal into jeopardy. It is unilateral, contemptuous and outrageous," he said.

"The MDC totally and absolutely rejects this nonsense. ZANU-PF is taking people for a ride and there is a price for that."

The official Herald newspaper said no cabinet appointments would be made before Mbeki returns to Zimbabwe, but added there was disagreement only over the Ministry of Finance.

Chamisa dismissed this as "ZANU-PF propaganda." Tsvangirai is set to hold a political rally in Harare on Sunday where he is expected to make his first public comments on Mugabe's move.

The power-sharing deal allows Mugabe, in power since Zimbabwe's independence from Britain in 1980, to retain the presidency and chair the cabinet. Tsvangirai, as prime minister, will head a council of ministers supervising the cabinet.

ZANU-PF will have 15 seats in the cabinet, Tsvangirai's MDC 13 and a splinter MDC faction led by Arthur Mutambara three posts, giving the opposition a combined majority.

The government gazette said Mugabe's ZANU-PF would be in charge of the foreign affairs, justice and the media and information ministries. The MDC would take the health, public service and constitutional and parliamentary affairs portfolios.

Zimbabwe's economy is imploding with official inflation at a new record 231 million percent, while shortages of food, foreign currency, water and electricity have hit many the hardest.

The Reserve Bank of Zimbabwe introduced a new higher denomination 50,000 Zimbabwe dollar note on Saturday, barely two weeks after launching 10,000 and 20,000 dollar notes.

Zimbabweans will now be able to withdraw Z$50,000 ($284) from their accounts daily, enough to buy three loaves of bread. Previously people could take out Z$20,000 after the central back capped daily withdrawal limits, blamed for long queues at banks.

(Reporting by MacDonald Dzirutwe; Editing by Elizabeth Piper)