The government of Zimbabwe President Robert Mugabe held talks yesterday with labour leaders and employers, aimed at halting the country's economic nosedive, which has condemned some 80 percent of Zimbabweans to a life of abject poverty.

Senior representatives of Mugabe's government met with union officials and employers in the capital, Harare, under the auspices of the International Labour Organisation (ILO), just days after scores of labour leaders and activists were arrested as they tried to protest against deepening poverty and the worsening economic crisis.

Wellington Chibebe, secretary general of the Zimbabwe Congress of Trade Unions (ZCTU) - one of the labour leaders who was arrested last week - said labour would like to help with national efforts to reduce poverty, but the government was preventing it from doing so.

"We are not given the space - the space is not only about workshops, the space is expression on the streets, in our homes and in government offices, not in beautiful hotels.

"When we try to express our view as the labour movement, we get incarcerated by the same government which is rallying us around the issue of working out of poverty," said Chibebe.

Chibebe spent two days in police cells last week along with scores of other activists accused of taking part in illegal anti-government demonstrations.

Yesterday Chibebe blamed the political situation in the southern African country for the economic crisis and high poverty levels.

"We take that (politics) as the main cause of poverty in Zimbabwe. The powers that be have to address the political landscape in order for the economic landscape to be even," he said.

Ministry of Labour and Social Welfare acting secratary Sydney Mishi blamed worsening poverty in Zimbabwe on targeted sanctions by the West against Mugabe and his associates, and the implementation of land reforms as the southern African country went through a severe drought.

"For the last two years we have had issues of drought... and a drought situation that concides with a major land reform programme, (and) basically production has gone down," he said.

Aid organisations have said that the government's controversial policy of seizing white-owned farms for redistribution to new black farmers has contributed to severe food shortages.

The European Union imposed a travel ban and financial restrictions on Zimbabwe's leadership after Mugabe was re-elected in polls in March last year, which were marred by violence and widely condemned as rigged.

Washington followed the EU's lead in punishing Mugabe, placing the long-time leader of Zimbabwe and dozens of his top officials on a visa blacklist, freezing their assets in US banks, and slapping an arms embargo on the country.

"The (targeted) sanctions do hurt us and this economy is under siege," Mishi said.

ILO director general Juan Somavia said in a statement Monday: "Poverty is the product of inadequate political responses, bankrupt policy imagination and insufficient international support".

The Zimbabwe government, with the aid of the UN, has launched an assessment study to determine the trends and levels of poverty in the country.

Inflation in Zimbabwe hit 526% in October, and was last week projected by Finance Minister Hubert Murerwa to continue climbing, reaching 700% in 2004.

Meanwhile, Murerwa also predicted in his budget for next year that the economy would continue its downward slide, contracting a further 13% before year's end.

Unemployment is rampant in the southern African country, and ordinary Zimbabweans struggle on a daily basis with critical shortages of essential commodities blamed on a severe foreign currency shortfall. – Sapa-AFP.