Washington and Brussels have imposed visa bans and asset freezes on President Robert Mugabe and other senior Zimbabwean officials. U.S. sanctions also bar Americans from engaging in any transactions or dealings with them.
"They (the sanctions) hurt the ordinary people … if you have sanctions against the government then obviously investors will not want to deal with that government, tourists get frightened," Nkosazana Dlamini-Zuma said in an interview.
"They hurt the people that deserve the help, they hurt the whole people," the South African minister told Reuters.
Opponents of Mugabe say his policy of forcing white farmers off their land has exacerbated the problem in a country where hyper-inflation has crippled the economy. Mugabe blames international sanctions.
Zimbabwe’s economic decline, once seen by the opposition as the only factor that could weaken Mugabe, has been worsening while he digs in for a prolonged power struggle over the creation of a power-sharing government.
Inflation is officially 231 million percent. Zimbabwe is dependent on handouts and malnutrition is on the rise.
"The EU, the United States and other countries should begin to support the farmers to plant, to get fertilisers, to get business people to invest in Zimbabwe," Dlamini-Zuma said.
"It will help the people, they will get jobs, they will get money, they will be able to plant, they will be able to have food and not only to rely on aid," she added.
The European Commission proposed in July using 1 billion euros ($1.26 billion) in unspent EU farm funds on a programme to buy seed and fertiliser for Africa this year and next, helping the continent to deal with threatened food shortages.
But the proposal has run into trouble as EU lawmakers and governments said the bloc’s executive did not choose the right budgetary procedure.
"It is ridiculous to keep this fund in the air," Dlamini-Zuma said.
Zimbabweans had hoped a Sept. 15 political deal would create a power-sharing leadership that could rescue the ruined economy. Instead, Zimbabwe’s parties are deadlocked over allocating cabinet ministries. Reuters