Cape Town — The European Union (EU) announced Monday that it will suspend most of its sanctions on Zimbabwean leaders and organisations as soon as the country holds "a peaceful and credible" referendum on a new constitution.

The announcement was made after a meeting of European foreign ministers in Brussels.

The ministers said a referendum would "would represent an important milestone in the preparation of democratic elections that would justify a suspension of the majority of all EU targeted restrictive measures against individuals and entities."

However, Agence France-Presse reported an unnamed EU official as saying that President Robert Mugabe would not be among the more than 100 individuals against whom sanctions would be lifted.

"There is no question of lifting sanctions against Mugabe or anyone involved in continued abuses of human rights, incitement to violence, etc - that is simply not up for discussion," AFP quoted the official as saying.

The foreign ministers said the EU was encouraged by progress made in implementing the agreement under which Zimbabwe's unity government was established.

The government's steps "to improve the freedom and prosperity of the Zimbabwean people" justified lifting immediately some restrictions, which would allow the EU to work with the government in developing new assistance programmes.

The ministers said respect for human rights had improved, but "significant areas of concern remain."