South Africa fights to avoid being sucked in

Pressure is mounting on South Africa to help engineer a solution in Zimbabwe, but President Thabo Mbeki knows that in doing so he will walk a fine political tightrope.

Although to get concessions President Mbeki must show public solidarity towards President Mugabe on the land question, he will also have to avoid his own country being damaged by association, and by any social and economic spillover of the crisis into South Africa.

Mr Mugabe is starting to unravel years of careful management by a South African government that has pursued tight, investor-friendly economic policies, structured land reform and regional stability.

The crisis in Zimbabwe is forecast to slash 2 per cent off South African economic growth this year, as its farm invasions throw the spotlight on South African land reform programmes which are being criticised for being too slow.

The collapse of the rule of law in Zimbabwe has unsettled currencies, markets and trade in southern Africa, with investors assuming the entire region, already blighted by the unending war in Angola, will be sucked into the quagmire. The South African rand has fallen more than 10 per cent against the dollar in just two weeks.

"In the eyes of the world, Johannesburg is Harare is Nairobi," said Steven Friedman, director of the Centre for Policy Studies in Johannesburg. "The Zimbabwean crisis is affecting our confidence and the economy, which is why it is of real and immediate concern. The stock response of people and the media abroad is to think all of Africa is the same. What is happening in Zimbabwe will happen in South Africa. In the end, we are just another African basket case. But reality is more complex than that."

Mr Mbeki organised the Victoria Falls summit of southern African leaders on 21 April, and offered Mr Mugabe a R800m (£80m) lifeline - a bond issue to be raised on foreign markets and underwritten by South Africa. He also promised help in getting IMF and World Bank credit for land reform, and in persuading Britain, the US and the EU to support the reform.

But he was driving a hard deal. His conditions, South Africa's respected Financial Mail reported, were that Zimbabwe held free and fair elections in May, and that whoever won took "unpopular decisions" to fix the economy. Zimbabwe also had to pull its troops out of Congo, stop harassing the opposition and end land seizures.

The stance, though greeted with dismay by South Africa's middle classes, may indicate a close relationship between Mr Mbeki's administration and the British prime minister, suggested Mr Friedman. "It's the strongest relationship that the South African government has with any Western power."

Mr Mugabe appeared to agree to the Victoria Falls deal, but the actions of his government last week suggested otherwise as brutal intimidation of the opposition continued.

Mr Mbeki now has a dilemma on his hands. He has criticised the lack of democracy in Africa, but, in 1998, got his fingers burned badly after he blasted African leaders for bad behaviour in his "Dead Man's Creek" speech in the United States. It was Mr Mugabe who led the charge against him.