Efforts to set up substantive talks aimed at ending Zimbabwe's political crisis snagged on Thursday as the opposition leader stalled on signing a framework agreement with the ruling party.

Government sources quoted in the state-run Herald daily said representatives of the ruling Zanu-PF and two factions of the opposition Movement for Democratic Change had reached agreement on Wednesday that would have allowed substantive talks between the two sides to begin under South African mediation.

However the paper said main MDC leader Morgan Tsvangirai had declined to sign the agreement after a discussion with the chairman of the African Union commission, Jean Ping, who is due in the region later this week.

"It was agreed that the MoU (memoradum of understanding) was to be signed in Harare on Wednesday by the three principals and that commitment was conveyed to the facilitator," said an unnamed official quoted in the Herald.

"On Wednesday morning, Tsvangirai indicated that he was not going to attend because he had received instructions from Jean Ping not to sign the MoU."

In comments to the Star newspaper in Johannesburg, Tsvangirai confirmed he had not yet put his signature to an agreement but wanted to wait until Ping meets South African President Thabo Mbeki in Pretoria on Friday.

'Proccesses need to be tightened'

"It is not that we are refusing to sign, but that the processes need to be tightened," he said.

According to sources on both sides, the framework agreement sets out the talks agenda and includes calls for an immediate cessation of violence, one of the key demands of the opposition.

Tsvangirai has been pushing for greater involvement from the African Union, viewing Mbeki as inherently biased towards Zanu-PF and veteran President Robert Mugabe.

Tsvangirai won a first round of a presidential election against Mugabe in March although he fell just short of an absolute majority.

He pulled out of a run-off in June after dozens of his supporters were killed in attacks he blamed on Zanu-PF followers. Mugabe still went ahead with the poll, winning a sixth term by a predictable landslide.

The election has been widely denounced in the West as a sham although the United States and former colonial power Britain failed last week to win backing at the UN Security Council for sanctions against the Mugabe regime.

The European Union, which has said it will only deal with a government led by Tsvangirai, is however poised to toughen an already existing package of sanctions, hitting businessmen backing Mugabe's regime for the first time.

40 new names

"An in-principle agreement" on a move to add around 40 new names to a blacklist was reached overnight between EU ambassadors with the new sanctions to be endorsed at a meeting of the bloc's foreign ministers in Brussels on Tuesday, said diplomats.

The EU currently targets more than 130 individuals with visa bans and an asset freeze.

Although it wants to enter government, analysts say Tsvangirai's party is extremely wary of getting into bed with Zanu-PF which has governed the former Rhodesia since independence in 1980.

The rival ZAPU faction, led by the late Joshua Nkomo, entered into a coalition government in the early 1980s in a deal designed to put an end to violence in the south of the country which had claimed up to 20 000 lives.

Nkomo was handed the position of interior minister but was effectively neutered by his old rival Mugabe and saw his party swallowed up.

Eldred Masunungure, a lecturer in politics at the Univerity of Zimbabwe, said Tsvangirai was desperate to avoid a similar fate.

"We all learn from history and try to avoid the pitfalls that affected ZAPU," he said.

"They suspect that there may be something up the sleeves of Zanu-PF so they want to exercise extreme caution rather than plunge into negotiations that may not give them favourable results."

The MDC has refused to acknowledge Mugabe's victory in the 27 June poll but Tsvangirai has hinted there could be a role for him as a ceremonial head of state.

AFP