HARARE (Reuters) - Zimbabwean President Robert Mugabe said on Friday he would only implement terms of an agreement he signed in 2008 with rival Morgan Tsvangirai if the West removed sanctions on his allies.

Mugabe and Movement for Democratic Change (MDC) leader Tsvangirai, now prime minister, formed a coalition government last year but the fragile marriage has been rocked by disputes about how to share executive power.

South African President Jacob Zuma, who is mediating in Zimbabwe, held talks with the two rivals last week and said Mugabe's ZANU-PF and Tsvangirai's MDC had agreed a package of measures to rescue the unity government.

But on Friday Mugabe said there was no such package and his party would only make concessions if sanctions imposed on ZANU-PF members and a freeze on financial aid on Zimbabwe were scrapped by the West.

The MDC wants its treasurer-general Roy Bennett sworn-in as deputy agriculture minister, appointment of five of its senior officials to positions of provincial governors and for Mugabe to sack the attorney general and central bank governor.

"It's nonsensical for anyone to expect us to move on these issues when we are burdened with sanctions, not only as persons but as a country, that the MDC has asked for," Mugabe told hundreds of party members attending a ZANU-PF central committee meeting in Harare on Friday.

"The sanctions must go, must go. If they don't go there will be no concession that we will make, none whatsoever," Mugabe said to cheers from the ZANU-PF members.

DAMPENING TALKS

His comments put a dampener on talks between ZANU-PF and MDC negotiators to deal with "outstanding matters". The talks, which began on Thursday and were continuing on Friday are expected to end on Monday.

The negotiators would then report to Zuma on March 31, after which Southern Africa Development Community troika chairman Mozambican President Armando Guebuza may call a meeting to discuss the deal.

Guebuza leads the SADC political organ that also involves Swaziland's King Mswati III and Zambian President Rupiah Banda

Mugabe said his allies, central bank governor Gideon Gono and attorney general Johannes Tomana, would not be sacked.

"They are not going at all. Tomana and Gono will remain with us," Mugabe said.

The 86-year-old argues the MDC should lobby its allies in the West to remove sanctions and stop what ZANU-PF calls "pirate radio stations".

The veteran leader is largely blamed for running down a once prosperous economy through policies such as the seizure of white-owned commercial farms to resettle blacks and lately plans to force foreign-owned firms to cede majority control to locals.

Mugabe accuses former colonial power Britain of mobilising its Western allies to impose sanctions on Zimbabwe as punishment for the land seizures.

On Friday he criticised British Prime Minister Gordon Brown for rebuffing a call by Zuma this month to end targeted sanctions on Mugabe and ZANU-PF.

"Mr Brown must know that there will be no movement if sanctions don't go. The movement must come from him and who is he anyway to talk about that situation," said Mugabe.