Zimbabwe's increasingly beleaguered President Robert Mugabe who faces stiff competition in next month's harmonized Presidential, parliamentary and local government elections has vowed to "read the riot act" to business people whom he has accused of raising prices ahead of this weekend's polls, Mugabe says shops should today revert to prices prevailing before he announced a massive salary increment for teachers and civil servants.

He told rally-goers in the coal-mining town of Hwange, in Matabeleland North that companies would be taken over if prices do not go down.

"If industry fails to conform, the Indigenization and Empowerment Act will come into effect," state radio quoted the 84-year-old president as saying. The Act, signed earlier this month, obliges foreign and white-owned businesses to hand over 51-per-cent shares to blacks/Zimbabweans.

With days to go before polling, there is speculation Mugabe may order another price blitz to endear himself to struggling voters. A similar blitz in June and July last year emptied shops of most goods. Many stores are still sparsely stocked.

The Zimbabwean president is facing what could prove the biggest challenge of his 28 years in power, with two strong contenders: opposition leader Morgan Tsvangirai and former finance minister Simba Makoni.

At the Hwange rally Mugabe also promised he would hand out 400 luxury vehicles to government doctors on Thursday. Doctors have been leaving the country in search of better pay and conditions overseas.

Rights groups complain Mugabe has engaged in massive vote-buying, handing out buses, farm equipment, salary increases, fuel and computers ahead of Saturday's polls.

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