By MacDonald Dzirutwe
HARARE (Reuters) - Zimbabwe will increase economic ties with friendly countries like China to develop its economy as Western nations maintain their sanctions after President Robert Mugabe's re-election, the new finance minister said on Wednesday.
Mugabe, Africa's oldest leader at 89 who won a fresh five-year term in a July 31 vote his opponents say was rigged, on Wednesday swore in his cabinet, including Finance Minister Patrick Chinamasa who was named on Tuesday.
Pointing to multiple flaws in last month's election cited by domestic vote observers, Western governments, especially the United States, have questioned the credibility of the outcome and are considering whether to prolong sanctions against Mugabe.
However, African election observers broadly endorsed the voting and its result as peaceful and free.
Chinamasa told reporters the ZANU-PF party government had accepted the reality that the West would not remove financial and travel sanctions on Mugabe and his senior allies and would not release any direct financial assistance.
"Because the doors have been closed by those who used to be our traditional partners, we have to intensify new economic relationships and friendships. That means every country that is friendly to Zimbabwe, including China," he said.
After Western states imposed sanctions a decade ago against Mugabe over alleged violations of democracy and rights abuses in the former British colony he has ruled for 33 years, China has emerged as a major investor in the southern African state.
It has built the largest alluvial diamond mine in the east of the country and runs the biggest ferrochrome producer.
A Chinese-backed firm will start mining coal in western Zimbabwe and build a 600MW coal-fired power station next year. The government has also given $1.7 billion of contracts to Chinese firms to expand the country's two largest power plants.
"GET MONEY QUICKLY"
Under the now dissolved unity government that followed a disputed 2008 election, the economy had begun to recover. The International Monetary Fund said in June it agreed to monitor economic programs until the year end, paving the way for the clearing of billions of dollars of Zimbabwe's debt arrears.
Chinamasa, ZANU-PF's top legal official and a staunch defender of Mugabe's re-election, refused to comment on whether these program would continue but said the economy faced enormous challenges.
While Washington has made clear it intends to maintain U.S. sanctions, Belgium, the center of the global diamond trade, is demanding that the European Union lift sanctions on one Zimbabwean mining firm.
Mugabe later told reporters on Wednesday his new cabinet would focus on agriculture and diamond and gold mining to raise money to re-start shut industries and increase government wages.
"We should organize quick-yielding sectors of the economy and these are agriculture and mining. These are the sectors I am looking at to get money quickly," the president said.
Last month, he threatened "tit-for-tat" retaliation against companies from Britain and the United States if those Western nations persisted in pressuring his government with sanctions and what he called "harassment".
(Editing by Pascal Fletcher and Andrew Heavens)