Zimbabwe state workers want to negotiate pay in US dollars

Workers can only access US dollars on the parallel market to pay for goods and services.
Image: Bloomberg

Zimbabwean government employees have appealed to their employer to negotiate salaries in U.S. dollars, citing loss of earnings and exchange-rate distortions when paid in the local currency.

“It was demonstrably clear that the exchange-rate distortions and the resultant inflation no longer allow for meaningful Zimbabwe dollar negotiations, hence the need to focus on USD being the currency that is ruling the market,” Zimbabwe Confederation of Public Sector Trade Unions President Cecilia Alexander said in a letter to Public Service Minister Paul Mavima seen by Bloomberg.

The government has as many as 300,000 employees, with the lowest salary at Z$18,000 ($155.97). The workers can only access U.S. dollars on the parallel market to pay for goods and services, she said.

Officially, the local currency is trading at Z$115.40 against the U.S. dollar, but readily exchanges for Z$230 on the streets of Harare. The annual inflation rate was 60.61% in January.

“Radical measures need to be taken to find a lasting solution to the salary circus by adopting a road map toward a U.S. dollar salary regime,” Alexander said.

The minister acknowledged receiving the letter and said the negotiations are still on.

© 2022 Bloomberg L.P.

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These recurring articles on Zimbabwe remind me of an incident in Kampala about 40 years ago. A friend was working for the IMF and was being driven from the airport to the city. The road was badly potted. After a while he asked the taxi driver why the road was so bad. The taxi driver paused and gave the question some intense thought.

“Sir” he said, “the British built it badly in 1948”.

Has it occurred to anyone else that maybe,just maybe,those in charge in Zim just don’t have a cooking clue?

End of comments.

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