Pressure set to mount on Mugabe as Zimbabwe prices surge
06 Feb 2007 15:49:33 GMT Source: Reuters
By Nelson Banya HARARE, Feb 6 (Reuters) - The cost of consumer goods in Zimbabwe surged by more than 200 percent in less than a week, a central bank document showed -- raising the chances of widening strikes and added political pressure on President Robert Mugabe. Political analysts say that with the economic crisis blamed largely on Mugabe's politics seen worsening, spontaneous strikes may be on the cards, as dissatisfied workers turn to the streets to express their rage. The country has this year seen wildcat strikes by doctors and nurses, which have crippled state hospitals. Some teachers at government schools started boycotting classes this week, with others on go slow, while university lecturers have reportedly gone on strike to demand better pay. "Every Zimbabwean is crying out for salvation from hunger, poverty, destitution, escalating cost of living and meaningless wages," Arthur Mutambara, the leader of a splinter group of the main opposition Movement for Democratic Change told journalists. "We will soon launch a campaign of defiance against the regime ... the price of freedom is death. Give me freedom or give me death," Mutambara said on Tuesday. Zimbabwe opposition parties have vowed to resist plans by Mugabe to extend his long rule by two more years to 2010, which they say will only further cripple a struggling economy. Analysts are however cautious on the success of any anti-government protests, saying Mugabe -- who has warned the army will "pull the trigger" on opponents -- would use state security agents to crush any demonstrations. The southern African country is in the grips of a deepening recession marked by the world's highest inflation rate of 1,281 percent, shortages of foreign currency, fuel and food and unemployment of around 80 percent and increasing poverty. In a survey made available to Reuters on Tuesday, the central bank said prices of basic food stuffs like meat, cooking oil and salt and clothing items had risen by up to 223 percent after governor Gideon Gono presented a monetary policy last Wednesday. The 223 percent rise was in a sub-sector of the main consumer price basket, which is set to be updated next week. Gono did not devalue the local dollar as widely expected, fearing this would fuel inflation further but instead called for a price and incomes freeze to tame the "inflation dragon". The Reserve Bank again called for the freeze, which would also see Mugabe's government slash spending which is largely blamed for fuelling money supply growth and inflation. "Short of this, the inflation monster will sink its claws deep in the economy to depths where no fiscal or monetary policy interventions will be able to reverse it," the bank said in remarks accompanying the survey. Critics however doubt the government's commitment to the pact, while labour groups said they would not favour a wage freeze at current salary levels. The government set the minimum wage at 100,000 Zimbabwe dollars ($400) in November, against a poverty line of about 344,256 Zimbabwe dollars. The Zimbabwe dollar is officially pegged at 250 to the greenback but fetches up to 5,000 on a thriving black market. "There is no reason to believe government, which failed to commit to a tripartite agreement reached with labour and business will do so this time around," said Prosper Chitambara of the Labour and Economic Development Research Institute. The country's main labour group, Zimbabwe Congress of Trade Unions last month gave the government a Feb. 23 deadline to address workers demands such as aligning salaries to the poverty line or face street protests. (Additional reporting by MacDonald Dzirutwe)
