By Costa Nkomo
Following the Reserve Bank of Zimbabwe’s (RBZ) recent decision to devalue the Zimbabwe Gold (ZiG) currency by over 40%, Finance Minister Professor Mthuli Ncube has announced a pay rise for civil servants in an effort to restore their purchasing power.
The devaluation, which took place last Friday, has caused widespread distress, particularly among civil servants who had just received their salaries.
The ZiG has seen a sharp decline, with the parallel market now selling US$1 for 35 ZiG. This depreciation has driven up the prices of basic commodities, leaving many struggling to make ends meet.
“We are aware that implementing a flexible exchange rate or devaluation has an immediate impact on incomes and prices. As a government, we will adjust civil servants’ salaries to ensure their purchasing power is restored,” Ncube said.
However, Corban Madzivanyika, Finance Shadow Minister for the Citizens Coalition for Change (CCC), warned that this salary increase could exacerbate the economic crisis.
“Increasing the money supply will inevitably lead to higher prices. The vicious cycle continues, which will negatively impact inflation,” Madzivanyika stated.
He further argued that the salary adjustment should not be considered an increment but rather a restoration to pre-devaluation levels. “This adjustment must reflect the true devaluation rate of 74%,” he added.
Madzivanyika also criticized President Emmerson Mnangagwa’s recent State of the Nation Address (SONA), describing it as “empty” and devoid of meaningful solutions.
“There’s nothing in it. It’s empty,” he remarked, adding that he had expected the President to outline strategies to address the ongoing power crisis, rather than merely reiterating known problems.
