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HARARE (Reuters) – Zimbabwe raised salaries for government workers by 50% on Wednesday, hours after nurses stopped work at a major government hospital in the capital Harare, demanding to be paid in dollars because of soaring inflation.
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Workers fear the country is returning to the 2008 era when a bout of hyperinflation rendered salaries and savings worthless. The government brought back the Zimbabwe dollar last June.
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Finance Minister Mthuli Ncube said in a statement the salary hike would take immediate effect, adding that workers would also get a monthly allowance of $75.
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Inflation has risen to 785%. The price of bread and sugar increased by at least 30% this week alone.
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Nurses began their protest despite concerns about the impact on Zimbabwe\’s fight against COVID-19, which has infected 401 people and killed four in the southern African country.
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Anti-riot police blocked the entrance to Parirenyatwa Hospital in Harare as hundreds of nurses picketed inside.
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Zimbabwe Nurses Association secretary general Enock Dongo told Reuters that the least-paid nurses were earning a net monthly salary of 2,000 Zimbabwe dollars and warned that the boycott could continue beyond Wednesday and spread to other hospitals.
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The Zimbabwe dollar is fixed at 25 to the U.S. dollar but trades at around 80 on the black market. Businesses calculate prices using black market rates.
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Central bank governor John Mangudya said in a statement it would introduce an auction system from June. 23 to improve transparency in foreign currency trading.
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The move is meant to remove the discredited fixed exchange rate that exporters say disadvantages them and makes the cost of business more expensive.
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Mangudya said individuals and companies would be allowed to make a single bid of up to a maximum of $500,000 per auction.
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(Reporting by MacDonald Dzirutwe, Editing by Timothy Heritage and Nick Macfie)
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