Zanu PF insists "only Finance Ministry is up for grabs", MDC wants Home Affairs

The Herald newspaper, controlled by Mugabe’s administration, said proposals will be tabled on leadership of the ministry crucial to reviving Zimbabwe’s ruined economy and attracting foreign investment.

Negotiations, mediated by former South African President Thabo Mbeki, ended without agreement on Tuesday.

Tsvangirai threatened to pull out of the agreement on Sunday after Mugabe allocated key ministries, including defence, home affairs — which oversees the police — and finance, to his ZANU-PF party.

Mugabe and Tsvangirai said negotiations on Tuesday were not conclusive, but the Herald, quoting sources, said new proposals had been put forward and a deal was possible on Wednesday.

"The insiders also pointed out that the remaining issue of major debate was the ministry of finance and that a number of options had been tabled on how to go around the matter," it said.

Neither opposition nor ruling party officials were available to comment on the Herald report.

It said one proposal was for a nominated finance minister top have two deputy ministers from Tsvangirai’s Movement for Democratic Change and a smaller breakaway faction of the party. Another option was to appoint a neutral person to the post.

A new government will have to tackle the world’s highest inflation rate of 231 million percent and severe food, fuel and foreign currency shortages.

Analysts say that although the power-sharing agreement could be in danger, the rivals are under pressure to reach a settlement. However, Mbeki may have less leverage in Zimbabwe after being ousted as South African president by his own party last month.

Mugabe’s party was stripped of a majority for the first time since independence from Britain in 1980 after a March 29 election which the opposition says he rigged to retain power. Reuters