- The Washington Times - Thursday, May 18, 2000

Foreign donors are warning that political unrest and economic mismanagement in Zimbabwe could prove costly to the government of President Robert Mugabe.

The State Department said yesterday it will be watching next month's parliamentary elections closely as it considers whether to push a proposed $15 million aid request for the Southern African nation for the 2001 fiscal year, which starts in October.

The Clinton administration has already frozen a small Agency for International Development (AID) program designed to bolster Zimbabwe's now-suspended land-reform program.

State Department spokesman Phil Reeker said yesterday that it would be "premature" to cut the aid programs, but that the department wants to see whether international observer teams, including a U.S. delegation, certify that the June 24-25 elections are conducted fairly and freely.

Britain announced Friday that it was imposing an immediate arms embargo on its former colony because of a violent spree targeting mostly white farmers and members of the opposition Movement for Democratic Change. At least 16 black supporters of the MDC, four white farmers and a police officer have died in violence many say has been encouraged by the embattled Mr. Mugabe.

The latest victim, believed to be an MDC activist, died yesterday of injuries suffered during a violent clash Tuesday with Mugabe supporters near the capital, Harare.

Mr. Mugabe's opponents say he has encouraged the often-violent takeovers of more than 1,000 white-owned farms, accusing them of supporting his political opponents.

Mr. Mugabe, who first took power in 1981, faces the greatest electoral threat to his control in the upcoming parliamentary elections. The president's own term runs through 2002.

In Strasbourg, France, European Union Development Commissioner Poul Nielsen told the European Parliament yesterday that the substantial EU aid package could be suspended or eliminated altogether if the elections are deemed unfair and the political violence intensifies.

Over the past six years, the executive arm of the EU has given nearly $29 million a year to Zimbabwe. As with the United States, most of the money has gone for economic development and education, as well as to address a massive AIDS crisis.

"Suspension would be economically crippling for Zimbabwe," Mr. Nielsen said. He added the EU was not acting before the parliamentary vote for fear that Mr. Mugabe's government would portray the cutoff as an effort to influence the vote.

Separately, the World Bank yesterday confirmed it had stopped its lending program to Zimbabwe after the country fell more than two months behind on the repayment of past loans totaling $941 million.

The suspension puts into serious doubt a proposed $448 million in new World Bank loans to Zimbabwe and raises the specter the country might also be unable to service some $4.7 billion in foreign debt.

In addition to his political woes, Mr. Mugabe oversees an economy that endured a record 70.4 percent inflation rate last year, while unemployment stands at 55 percent.

The World Bank loans finance projects in agriculture, environmental control and financial management, according to spokesman Richard Uku. The bank will continue to make purchases and other promised non-loan payments to Zimbabwe through Aug. 15, when all funding will be stopped, he said.

The economic woes and land reform troubles in Zimbabwe have spilled into South Africa, the region's financial and economic engine. The South African rand has been under heavy pressure as the crisis across the border has deepened in recent weeks.

• This article is based in part on wire service reports.

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