PREVIEW-Zimbabwe struggles with budget, donors want reforms

By Cris Chinaka

HARARE Nov 29 (Reuters) - A lack of cash is likely to prevent Zimbabwe unveiling any major projects in its 2010 budget, but analysts say it could provide the impetus for the reforms needed to attract foreign aid to rebuild the economy.

Finance Minister Tendai Biti is due to present his 2010 budget on Wednesday -- the first full budget by the unity government formed 10 months ago to try to end a decade-long political and economic crisis in the southern African nation.

"This is a straightforward issue. The government is broke and is living hand to mouth," said veteran independent economist John Robertson.

"There is very little money for the pressing demands on the government and until they are able to get some massive help there is very little they will be able to do," he told Reuters.

"The positive side is that we may see greater movement towards reforms, more pressure to respect private property rights and an appreciation that the country needs massive international assistance and goodwill to realise its goals."

Zimbabwe is trying to reconstruct an economy that the government estimates contracted by nearly 50 percent from 2000-2008.

The global economic downturn and festering tensions in a ruling coalition between President Robert Mugabe and his arch rival, Prime Minister Morgan Tsvangirai, are not helping.

Biti -- a senior figure in Tsvangirai's Movement for Democratic Change (MDC) -- has promised a "growth oriented" budget, but the coffers are bare, and there is no sign of any significant aid on the horizon.