Zimbabwe Adjusts To US Dollars Payments To Civil Servants Following ZIG Devaluation
US Dollar and Zimbabwe ZIG
Zimbabwe Adjusts To US Dollars Payments To Civil Servants Following ZIG Devaluation.
In a move to shield lower-income earners from inflation and rising poverty, the government of Zimbabwe is adjusting its approach to civil servant remuneration, according to Public Service, Labour, and Social Welfare Minister July Moyo. The adjustment follows the recent revision of the Zimbabwean Dollar (ZiG) exchange rate from 1:14 to 1:24 against the US dollar.
While speaking to The Sunday Mail, Moyo revealed that the Treasury has already secured the necessary US dollar funds to support the government’s new employee salary structure. He noted that this move includes a significant boost in the US dollar portion of salaries for public workers.
“The government has allocated a substantial amount in US dollars to ensure all civil servants benefit from these salary adjustments,” Moyo stated. “Under the President’s directive, we are prioritizing salary increases for lower-income employees to help reduce the wage disparity.”
Moyo also confirmed that the government is committed to paying civil servants their annual bonuses this year. Consultations regarding the timing of the 13th cheque are ongoing, but the bonus payment is guaranteed.
Launched in April, the ZiG has struggled on the parallel market despite various efforts by the Reserve Bank of Zimbabwe (RBZ) to stabilize the foreign exchange system. Among the tactics employed by the RBZ was a crackdown on illegal foreign currency traders earlier this year.
This salary adjustment initiative and the ongoing efforts to stabilize the economy are seen as crucial steps by the government to alleviate the financial strain on civil servants and restore public trust in the country’s currency system.
Critics argue that the RBZ has not done enough to ease the operation of the currency market. They believe restoring confidence in the system will require the central bank to streamline processes, reduce bureaucratic hurdles, and tackle inflation head-on. Additionally, there are calls for greater fiscal discipline, enhanced transparency, and improved communication from the RBZ to achieve long-term market stability.
