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Mugabe Loses Majority, May Seek Presidential Runoff (Update3)

By Brian Latham and Antony Sguazzin

April 3 (Bloomberg) -- Robert Mugabe's 28-year era of absolute control of Zimbabwe is over after opposition parties won a majority in parliament. He may be forced into a runoff just to remain as president.

Four days after polls closed March 29, electoral authorities announced yesterday that opposition politicians won 111 of the 210 seats in parliament's House of Assembly. Election officials still haven't released results from presidential and senatorial races held the same day.

The ``loss of parliamentary control is probably the most significant event since independence in 1980,'' said Alec Kaseke, a former political science lecturer at the University of Zimbabwe in Harare. Mugabe ``won't be able to bulldoze the people in one direction or the other.''

Official results from the presidential election will be released from today and may show that neither Mugabe, 84, nor opposition leader Morgan Tsvangirai, 56, won a majority in the presidential race, said Mugabe's spokesman George Charamba. That outcome would require a runoff within three weeks.

The ruling Zimbabwe African National Union-Patriotic Front is ready to ``unleash its full power'' behind Mugabe in a presidential runoff, Deputy Information Minister Bright Matonga said today in a phone interview from the capital, Harare. ``We are ready for victory,'' he added.

`The Back Foot'

If he retains the presidency, Mugabe would be a weaker, though by no means impotent, leader. Until now, he controlled all levels of Zimbabwe's government since he helped lead a guerrilla army that overthrew white-minority rulers in 1980.

The Senate, created last year as a separate parliamentary chamber, can block legislative proposals, so it would be a check on the Assembly's ambitions if Mugabe senators control it. And Mugabe has used nearly three decades of absolute control to push through constitutional amendments to strengthen the presidency.

``There is no question that Mugabe is on the back foot, the momentum is with Tsvangirai,'' Marian Tupy, an analyst at the Washington-based Cato Institute, said in an interview late yesterday. ``They may well declare that there has to be a runoff.''

Support for the president withered as his policies spawned a decade-long recession and the world's highest inflation rate, 100,580 percent. He seized white-owned commercial farms and turned them over to black small-scale farmers who mainly grew food for their own families. That policy won him support from poor Zimbabweans deprived of land under colonial rule, while slashing exports and causing shortages of fuel and food.

`The Next President'

Tsvangirai's Movement for Democratic Change released its own tally of presidential votes -- based on results posted outside of individual polling places -- and said he beat Mugabe.

Tendai Biti, the MDC's secretary-general, said Tsvangirai won 50.3 percent of the votes, enough to avoid a runoff. In remarks broadcast live from Harare by the British Broadcasting Corp., Biti said Mugabe obtained 43.8 percent.

``Morgan Richard Tsvangirai is the next president of this country, without a runoff,'' Biti said. ``The opposition has won the elections.'' The MDC would participate in a runoff only ``under protest,'' he added. ``It is highly unlikely that people's decisions will be reversed in a runoff.''

An assessment of the vote by the independent Zimbabwe Electoral Support Network indicated that Tsvangirai might not be able to avoid a runoff. A sample of 435 polling stations, covering 5 percent of the population, showed Tsvangirai with 49 percent of the vote, Mugabe with 41 percent and former Finance Minister Simba Makoni, who ran as an independent, with 8 percent, the group said.

Rand Gains

The South African rand gained for a fourth day against the dollar on speculation that Mugabe's reign may be over, bringing stability to the region.

``A change of leadership in Zimbabwe is positive for the entire region,'' said Russell Lamberti, an economist at Econometrix Treasury Management, which advises clients on bond and foreign-exchange transactions in Johannesburg. ``It's a significant political development right on our doorstep and it's definitely helping the rand.''

The rand traded at 7.7562 to the dollar as of 11:14 a.m. Johannesburg time compared with 7.8225 late yesterday and 8.1432 on March 28, the day before the elections.

Shares of mining companies with assets in Zimbabwe also rose. Zimplats Holdings Ltd., the company controlled by Impala Platinum Holdings Ltd. that runs Zimbabwe's platinum mines, jumped 11 percent to A$15.90 in Sydney trading.

Government Action

In London, Mwana Africa Holdings Ltd., which owns nickel mines in Zimbabwe, climbed 5.7 percent to 56 pence as of 8:44 a.m. local time. African Consolidated Resources Ltd., taking legal action to get a diamond concession seized by Zimbabwe's government returned, gained 2.4 percent to 31.75 pence.

Government officials urged the MDC to await official results, warning that its claims of victory may provoke unrest. Charamba accused the MDC of ``trying to rig the elections'' and hung up after being contacted in Harare.

If the MDC's claim of victory leads to protests, the government may take action, said Matonga in a telephone interview from Harare.

``The MDC are doing this in a mischievous way to create an uprising,'' Matonga said. ``They don't have the capacity to defend themselves. If they want to provoke the police and army, they have to be very careful.''

`Huge Pressure'

In parliamentary races, election officials announced on state television that the MDC secured 99 of the 210 seats in the House of Assembly, while Mugabe's ZANU-PF won 96. An MDC splinter group led by Arthur Mutambara won 11 seats; an independent candidate got one.

With only three seats remaining to be decided in later by- elections, it's impossible for Zanu-PF to retain its majority in the chamber.

Analysts say the MDC may not be able to secure control of the government without support from some members of Zanu-PF.

``Clearly Zanu-PF and Mugabe have come under huge pressure,'' said Anne Fruehauf, an analyst at Control Risks in London. ``There needs to be some insurance policy for the absolute hardliners, and if anyone seriously wants a smooth transition, there will have to be a policy of co-opting Zanu-PF figures.''

Streets Quiet

The delay in official results has spawned a spate of reports about Mugabe's fate. Johannesburg's Business Day newspaper reported that he's in talks with security service heads to decide whether to quit after telling them and his family that he lost the vote, citing unidentified people close to the Zimbabwean leader. Some security heads want him to try and stay in power while his family and personal advisers are urging him to resign, the newspaper added.

The MDC denied an April 2 statement by John Makumbe, a political analyst from the University of Zimbabwe, that it is in talks with the military to arrange a transition of power. A Mugabe spokesman also denied that such talks are under way.

The normally bustling streets of Harare were quiet yesterday amid fears that violent protests and a police crackdown would follow a declaration that Mugabe won, people there said.

To contact the reporters on this story: Brian Latham via the Johannesburg bureau at pmrichardson@bloomberg.net; Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net

Last Updated: April 3, 2008 06:04 EDT

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