Mugabe's party intends to adopt tougher measures against firms defying the freeze introduced last week when the government ordered businesses to return prices to June 18 levels.
The move sparked frenzied buying from shoppers and was ordered after prices of some goods tripled within a week.
 
'Empty shelves'

At his party headquarters in Harare, Mugabe said: "This is no joke ... there are some people who think this [freeze] will not succeed because they say there are empty shelves.

"We are saying to all factory owners you must produce. If you don't produce we certainly will seize the factories."

Spiralling prices and soaring inflation are part of an eight-year economic crisis that has caused foreign currency, fuel and food shortages.

Economists say the price freeze would decimate what remains of Zimbabwe's struggling industry as manufacturers will not be able to produce goods at a loss.

Zimbabwe's leader said his government was still not satisfied with current price levels and he wanted even lower prices to cushion people from inflation.

Mugabe again accused businesses of raising prices as part of a wider plot by Britain, Zimbabwe's former colonial ruler, to remove him from power and rejected suggestions that the price freeze was illegal.

He said Zimbabweans should alert a special unit of police, army and intelligence operatives formed to enforce price controls of businesses hoarding or unfairly increasing prices.

Arrests

More than 200 business people, including a Zanu-PF senator, have been arrested for ignoring the ban on price hikes.
 

"We are saying to all factory owners you must produce [because] if you don't produce we certainly will seize the factories"

Robert Mugabe, president of Zimbabwe

Mugabe supporters had earlier marched from Zanu-PF's Harare provincial office to its national headquarters where the 83-year-old leader was to preside over a meeting of the party's powerful central committee.

The central committee meeting on Friday is expected to adopt tougher measures to crack down on defiant businesses and extend products covered by the freeze.

The price controls cover basic goods such as maize meal, sugar, salt, bread, beef, rentals and were on Friday extended to fuel.