January 30, 2009 / 8:33 AM / 9 years ago

CORRECTED - DAVOS-INTERVIEW-S.Africa to help rebuild Zimbabwe-president

(Corrects spelling of president’s first name)

By Emma Thomasson

DAVOS, Switzerland, Jan 30 (Reuters) - South Africa will help rebuild Zimbabwe once a unity government is formed there next month and hopes investors will return quickly, President Kgalema Motlanthe said on Thursday.

“This stage is really critical in terms of achieving political stability and the first step towards the economic recovery of that country,” Motlanthe told Reuters at the World Economic Forum annual meeting in the Swiss Alpine resort.

“We could very well establish a (joint commission) so our ministeries could cooperate in terms of that economic recovery plan,” he said.

Regional leaders decided at a summit on Tuesday that a unity government should be formed next month, finally implementing a September power-sharing accord between Zimbabwe’s rival parties that has been stalled over the allocation of key cabinet posts.

Zimbabwe’s economic meltdown has been worsened by a cholera outbreak which has killed nearly 3,100 people and infected some 59,000 across the country -- the worst death toll in Africa in 15 years from an outbreak of the normally preventable disease.

The United Nations said on Thursday that unemployment in Zimbabwe was 94 percent. Food and fuel are in short supply. The last official inflation rate, for July 2008, was 231 million percent.

Motlanthe said the first priority was to invest in infrastructure as the cholera outbreak was largely the result of burst pipes.

He noted that remittances from Zimbabweans working in neighbouring South Africa were keeping the country going, and said he was optimistic about Zimbabwe’s recovery because the country’s people were among the best educated in Africa.

“Once the political situation has stabilised, it will create an environment in which investors can come back,” he said.

The Davos meeting has focused on the global financial crisis and Motlanthe said South Africa’s economy had also been hit.

“We are already feeling the impact of shrinking demand,” he said, adding the plight of the world car industry was hitting demand for platinum, hurting his country’s mining industry.

Africa should invest more in infrastructure during the downturn so that “when the global economy gets onto an upswing, Africa can participate more meaningfully,” he said.

Motlanthe said progress on the long-running Doha round on freeing up global commerce was critical to head off fear of rising protectionism, but added: “The devil is always in the detail.”

Motlanthe, a former trade unionist, was appointed caretaker president after the ruling African National Congress ousted Thabo Mbeki amid party infighting in September last year. (Editing by Tim Pearce)

For full coverage, blogs and TV from Davos go to www.reuters.com/davos

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