Harare - Zimbabwe's political parties agreed on a draft constitutional amendment leading to the formation of a power-sharing government, but the opposition Movement for Democratic Change (MDC) warned that obstacles still remain.

"We have differed with Zanu-PF for a long time while the citizens suffer, but fortunately we have agreed on something," said MDC spokesman Nelson Chamisa in Harare late Friday. "I need to hasten to mention that we still have some outstanding issues such the cabinet, appointment of diplomats."

The MDC and President Robert Mugabe's ZANU-PF have failed to form a government of national unity despite signing a power-sharing deal in September, seen as a springboard to drag the country out of an economic meltdown.

The draft constitutional bill that recognizes the posts and institutions created by the September 15 deal is now awaiting the approval of the MDC and Zanu-PF leadership, but that is likely to be academic given that they had been consulted before. Former South African leader Thabo Mbeki - who is the mediator - has been meeting with the Zimbabwe rivals in Pretoria since Tuesday to discuss the amendment bill.

"It is something that we have always admired - meeting of minds of Zimbabweans when there is something to discuss," said Ephraim Masawi, the Zanu-PF deputy spokesperson. "We are happy that as a nation we have moved a step forward. We need to quickly start working to address the problems facing the nation."

The opposition has refused to form the government of national unity accusing Mugabe of grabbing all the key ministries such as foreign affairs, local government, finance, home affairs and defence.

Zimbabwe has been experiencing its worst economic and a humanitarian crisis since attaining independence from Great Britain 28 years ago.

Half the population is in urgent need of food aid as unemployment is estimated at 90 per cent, official inflation is at 231 million per cent, and an outbreak of cholera has been raging since September. The water borne-disease has so far claimed the lives of nearly 400 people. (dpa)