"We have made this decision and we made it without being forced.

"We want our colleagues in the country and outside the country to  approach it from that perspective. It is our decision. Let history be the judge of this decision."

Tsvangirai demanded that all political prisoners be freed before Wednesday's ceremony, but he did not say what action he would take if his call was ignored.

Scores of opposition party members and rights activists have been jailed since Tsvangirai finished ahead of the 84-year-old president in the first round of presidential election in March last year. 

'New era'

Al Jazeera's Haru Mutasa, reporting from Harare, said that Tsvangirai would call for the rival parties to work together in a speech at his swearing-in. 

In video

Tsvangirai announces cabinet choices

"It's going to be a conciliatory speech, to say 'We are going to open our hands to Zanu-PF, we are going to work together, move forward,' but also importantly to tell the international community that he is in charge, to assure people that he has the power," she said. 

The South Africa-brokered power-sharing deal was signed on September 15 last year but was stalled by wrangling over control of ministries and the security forces.

The dispute was settled by an agreement which saw the two parties name co-ministers to the home affairs ministry, which oversees the police force, and the creation of a new National Security Council.

"Tsvangirai's swearing in symbolises a new era for the people of Zimbabwe," Daniel Makina, a political analyst at the University of South Africa, said.

But he questioned how successful the new prime minister will be in tackling the huge economic and social problems that Zimbabwe faces.

"We only hope that his appointment will stem the tide of economic and humanitarian decline. But the lingering question is how effective are his powers going to be," he said.

Economic challenges

More than half of Zimbabwe's population needs food aid, unemployment is estimated at about 94 per cent and the economy is struggling to cope with hyper-inflation.

"We only hope that his appointment will stem the tide of economic and humanitarian decline"

Daniel Makina,
Political analyst

Public hospitals are closed with doctors and nurses unpaid, exacerbating a health crisis in a nation where 1.3 million people are HIV-positive, and cholera has hit nearly 70,000 people since August, killing about 3,400 of them.

Tsvangirai has said he will focus on creating economic stability and attracting foreign investment, but his ambitions may be hampered by the global financial crisis and donors' concerns over the deal with Mugabe.

The new power-sharing cabinet is expected to be formally sworn in on Friday, but Tsvangirai has already named his 21 appointments.

Tendai Biti, founding member and general secretary of the MDC, was named as finance minister - a key appointment given Zimbabwe's economic collapse.

However, in appointing Biti, a staunch political ally and vehement critic of Mugabe, Tsvangirai risks reinforcing fears that both leaders will select political allies rather than technocrats and economists.

Giving Biti the finance brief has also raised fears of confrontations between him and Gideon Gono, governor of the Central Bank and Mugabe ally.