Mugabe has completely lost his sense of reality, says US

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"We think he has reneged on the principle of power sharing," said US assistant Secretary of State Jendayi Frazer in Pretoria. Ms Frazer, who was sent by Secretary of State Condoleezza Rice to explain US policy to other southern African countries, added: "Today we know better."

A September agreement to form a unity government has unravelled over the fight for control of the main ministries, including home affairs and justice. Mr Mugabe and opposition leader Morgan Tsvangirai failed to reach agreement on key appointments.

The country's hyper-inflation means prices double every day and a cholera epidemic has killed more than 1,100 people.

Western nations, Zimbabwe's neighbours and investors had hoped a unity government with Mr Tsvangirai as prime minister would wrest enough control from Mr Mugabe to reverse policies they blame for Zimbabwe's economic meltdown, and avert total collapse.

Ms Frazer said Mr Mugabe was out of touch with reality and described him as a "man who's lost it". She highlighted abductions of MDC supporters, the spiralling cholera epidemic - which Mr Mugabe has blamed on his western foes.

Western leaders blame Mr Mugabe for the food and fuel shortages, and have increased calls for him to step down. Ms Rice said this month his departure was well overdue.

At a weekend conference of Zanu-PF, his political party, Mr Mugabe told delegates that he would "never, never, never surrender".