By Jon Herskovitz
JOHANNESBURG (Reuters) - President Robert Mugabe's failing health has likely forced his ZANU-PF party to press for early elections in Zimbabwe and accelerate a plan compelling foreign firms to surrender majority shareholdings, but it has not so far loosened his grip on power.
While factions within ZANU-PF are battling to take over from Mugabe, the 87-year-old leader is still the only figure who can unite the party and has so distanced himself from possible successors that no direct challenger has emerged.
In any case, ZANU-PF would be hard pressed in elections, that must be held by 2013 but which could come next year, if it fielded a candidate other than Mugabe, who has been in power since Zimbabwe gained independence from Britain in 1980.
But Mugabe has slowed down, diplomats have said. His meetings are fewer while his visits to Singapore for medical checks have increased.
Over the past few years, he is thought to have spent several weeks abroad for treatment, described as routine and for maladies such as eye trouble by official media. But talk in Zimbabwe of Mugabe's deteriorating health is taboo and harshly punished.
A June 2008 U.S. diplomatic cable released by WikiLeaks last month said Mugabe has prostate cancer that has spread to other organs. He was urged by his physician to step down in 2008 but has stayed in the job.
In the cable written by James D. McGee, the former U.S. ambassador in Harare, Zimbabwe's Central Bank governor Gideon Gono was cited as saying the cancer could lead to Mugabe's death in three to five years.
Mugabe went to Singapore for a medical check-up about two weeks ago, a privately owned newspaper in Zimbabwe reported, saying it was the seventh such visit this year by the president, who denies he is suffering from cancer.
"The health of Mugabe is deteriorating and ZANU-PF's success at the next elections is not assured unless it builds up a war chest and relies on coercion," said Anne Fruhauf, an expert on Africa at the Eurasia Group political risk consultancy.
ZANU-PF leaders fear that if Mugabe dies in office or his health forces him to quit before settling the succession battle, the party could disintegrate or the army could be tempted to take over.
Zimbabwe has pushed hard in the last few months to have foreign firms, mostly mining firms and banks, to abide by a law to turn over a majority stake of their holdings to locals.
Prime Minister Morgan Tsvangirai's Movement for Democratic Change, forced into a unity government with ZANU-PF after a disputed 2008 election marred by violence, said the empowerment law has undermined investor confidence and could strangle a fragile recovery in an economy crushed by hyperinflation under ZANU-PF management.
But whatever the potential problems for the economy as a whole, the income generated from implementing the law could be crucial for ZANU-PF and its supporters.
"(The law) is little more than an extortion scheme, with rival players offering companies 'protection' in return for pay and equity stakes," Fruhauf said.
Mining firms risk losing their claims in the country with the world's second-largest platinum reserves if they do not play along. Many are waiting for a future government more amenable to international investment before they ramp up production, analysts have said.
The MDC has a lead in opinion polls, and ZANU-PF likely needs cash to finance the tactics it has been accused of using to win elections -- hiring armed thugs to intimidate voters and rigging ballot boxes.
"Mugabe's health impacts entirely on Zimbabwe's political landscape. Everything revolves around his health and his age," said a U.K.-based Zimbabwe analyst who asked not to be named.
ZANU-PF is in a bind. Voters may not want to support Mugabe if they think he may not survive the term, but the party has no other candidate who can rally the electorate.
Zimbabweans in urban areas have probably heard of Mugabe's failing health, but urban areas are MDC strongholds. Many rural areas, considered ZANU-PF strongholds, have far les access to news and are probably not up to date on the health reports.
The most recent report on Mugabe's health came from the Archbishop of Canterbury, Rowan Williams, who met him during a visit to Zimbabwe this week and told reporters: "He's on top of things intellectually."
The problems facing ZANU-PF as it considers a post-Mugabe future were highlighted by the death of a top Zimbabwean army officer in a fire.
General Solomon Mujuru, a powerbroker in Mugabe's party for nearly four decades, was, according to authorities, burned to ashes when his farmhouse caught fire, which led to rumors he was murdered.
The incident has further muddied the waters within ZANU-PF, meaning that with the bruising succession battle still unresolved, attention remains focused for now on the state of Mugabe's health.
(Editing by Giles Elgood)
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