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UPDATE 3-Police, soldiers patrol Zimbabwe's Bulawayo as opposition protest thwarted

By Philimon Bulawayo

* Opposition suffers second court setback in four days

* Police, soldiers deploy in MDC heartland

* Planned protests could be banned after latest ruling (Updates with court ruling on protest ban, MDC comments)

By Philimon Bulawayo

BULAWAYO, Zimbabwe, Aug 19 (Reuters) - Hundreds of police backed by soldiers and army helicopters deployed in the Zimbabwean city of Bulawayo on Monday to prevent an opposition protest from taking place, a show of force that stopped a demonstration for the second time in four days.

The Movement for Democratic Change's (MDC) had called the Bulawayo event as it looks to rally support against President Emmerson Mnangagwa's government, which it accuses of ruling with an authoritarian streak and blames for the country's worst economic crisis in a decade.

Authorities banned the march on Sunday and a court upheld this on Monday. Magistrate Tinashe Tashaya, dismissing an MDC appeal, ruled that police followed the law in stopping the protest and that it could turn violent.

The High Court on Friday dismissed an MDC challenge against a police ban on its demonstration in the capital, Harare.

MDC lawmaker Innocent Gonese told reporters that the party disagreed with the two court rulings but would press ahead with protests in three other smaller cities starting Tuesday.

"We are going to sit down and review the situation in regard to the decision we are going to take in the event that these (police) prohibitions are issued willy nilly," said Gonese.

The party called off its protest on Friday in Harare after police there rounded up its followers and dispersed them with batons and water cannon and tear gas, prompting many shops and businesses to close.

In Bulawayo on Monday, large contingents of police patrolled on foot, horseback and in vehicles, setting up checkpoints on roads into the city, searching cars and people for weapons, and cordoning off the MDC offices and the magistrates court.

There were no reports of violence in the city, which is an MDC heartland.

"The law (used to ban the protest) is clearly unconstitutional and unjust but we have an obligation to comply because we are a peaceful organisation," David Coltart, a Bulawayo lawyer and MDC senator, told Reuters earlier on Monday.

Eight MDC officials, including its national chairwoman, were freed on bail by magistrate Tashaya after being charged with publishing falsehoods. They were arrested on Saturday as they distributed pamphlets urging residents to attend Monday's march.

UNDER THE SPOTLIGHT

Bulawayo saw massive looting and destruction of property in January as protests against a steep rise in the price of fuel turned violent, triggering an army crackdown that killed more than a dozen people.

Those deaths undermined a pledge by Mnangagwa to put an end to the repressive political climate that characterised much of his predecessor Robert Mugabe's 37 years in power.

The protest campaign, which the MDC intends to take to two other cities on Tuesday and Wednesday, is again casting a spotlight on that promise, a year after Mnangagwa was elected in a vote the party alleges was rigged.

Mnangagwa, 76, is also struggling to convince the growing ranks of the poor that austerity measures and other reforms can trigger an economic recovery. Anger is mounting over triple-digit inflation, rolling power cuts and shortages of U.S. dollars, fuel and bread.

The crisis has revived memories of the hyperinflation of a decade ago that forced Zimbabwe to ditch its currency.

The president, who was a Mugabe aide for more than four decades, says the economic problems stem from sanctions imposed by the West against his predecessor's rule nearly two decades ago, worsened by a severe drought that has halved the maize harvest.

On Sunday, the regional Southern African Development Community (SADC) group, meeting in Tanzania, said the sanctions should be lifted immediately "to facilitate socio-economic recovery". (Writing by MacDonald Dzirutwe Editing by John Stonestreet and Frances Kerry)