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Price hikes push cost of living to ZWL$2m

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The cost of living for a family of six doubled to ZWL$2m in June from the May figure following price hikes triggered by currency volatility, the Consumer Council of Zimbabwe (CCZ) has said, piling pressure on employers to review salaries.

Civil servants earn US$250  and ZWL$130 000 per month while the majority of the  private sector workers earn less than US$250 a month.

“This steep increase in the total figure of the basket has been caused by the movement of exchange rate both on the parallel market and official. Generally, all products in the basket have increased,” CCZ said.

“The influence of the parallel market exchange rate to over  ZWL$8000: US$1 from ZWL$4800: US$1 as at end of May 2023 was also a cost driver as some manufacturers and retailers are opting to buy US$ through this platform.”

Recently, Zimbabwe Congress of Trade Unions (ZCTU) said workers were living below the poverty datum line (PDL), calling for dollarised salaries.

“The economy has dollarised, prices of goods and commodities are now charged in US$. It is therefore imperative that workers must likewise be paid in the currency that is being recognised in the country,” ZCTU said.

ZCTU said  then PDL was  a moving target in this kind of an economy and it is a considered view that dollarisation could restore the wages and salaries of workers to that which prevailed in October 2018.

“The position of ZCTU is clear and has been indicated officially at the Tripartite Negotiation Forum. As ZCTU we are aware of the high levels of suffering and agitation of the workers and general populace with the prevailing situation.

“We have given our government and employers the chance to resolve the current impasses at TNF and various respective National Employment Councils,” reads part of the statement.

“We trust that social partners of TNF will understand that as long as the issues of salaries remain unresolved, we are sitting on a time bomb whose time is fast approaching.”

Instead of increasing salaries, companies are downsizing and retrenching workers.

In its June inflation report, the Confederation of Zimbabwe (CZI) said the vulnerable community spends most of their incomes on food; hence an increase in food inflation would have a higher impact on them than on the rich.

“A group of basic needs, including housing, water, electricity, gas, and other fuels also had a blended annual inflation rate of within triple digits.

“Given that the blended inflation has an effect of diluting the actual impact, protecting the vulnerable groups is of paramount importance through keeping inflation under check,” CZI said.

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