The Zimbabwe Congress of Trade Unions has slammed President Emmerson Mnangagwa for implementing a raft of economic stabilisation measures before consulting with partners at the Tripartite Negotiation (TNF) and warned the measures could trigger massive job cuts.
The TNF is a social dialogue platform which brings together government, business and labour representatives in order to establish common ground before enacting key public policies.
In a statement, ZCTU secretary general, Japhet Moyo criticised the manner in which the measures were affected.
“We are concerned about the nocturnal announcement of these measures without any social dialogue which goes against the letter and spirit of the TNF.
“The ZCTU is also concerned that some of these measures might further weaken the already weak confidence and trust in the local currency and economy in general thereby threatening the few remaining formal sector jobs,” said Moyo.
The union decried the fact that currently Zimbabwe has the highest annual inflation in SADC and the second highest in Africa after Sudan which has an annual inflation rate of 263,2% as at March 2022 which has seen ordinary workers bearing the disproportionate brunt from this chronic high inflationary trend with the nominal average monthly wages being massively eroded.
The union pointed out the major drivers of the chronic high inflation as the unsustainable increase in broad money supply, the widening black-market premium and the commodity price shocks induced by the war in Ukraine.
“Foreign currency cash withdrawal levy will discourage economic agents from using the formal banking sector which will further exacerbate the already high level of informality in the economy. The settlement of foreign currency tax obligations in local currency will also result in an increase in broad money supply growth in the economy which could further stoke up inflationary pressures in general,” said Moyo.
Moyo warned that the suspension of lending by banks will starve companies of working capital and in turn prompt job cuts.
“Going forward , the ZCTU reiterates its demand for payment of wages and salaries in US$ as the economy dictates. We also call for all the social partners to come together under the aegis of the TNF to address the macroeconomic and development challenges our economy has been facing in an inclusive and sustainable manner while leaving no one behind,” added Moyo.