Finance Minister spells out foreign currency pay plan
HARARE – Zimbabwe's new Finance Minister Tendai Biti says soldiers, teachers and civil servants will be paid in United States dollars as the coalition government tries to kick-start the shattered economy.
Biti says some 130,000 government employees will receive US$100 a month tax-free, replacing their local currency salaries.
There were enough foreign currency reserves to pay wages for February and March, Biti said Tuesday as he called for the country to get "working again".
Soldiers were paid in vouchers redeemable at selected banks Tuesday, while teachers were to be paid Wednesday and Thursday.
At his inauguration last Wednesday, Prime Minister Morgan Tsvangirai said all civil servants were going to receive their salaries in foreign currency this month.
He was contradicted by the then acting Finance Minister Patrick Chinamasa who said civil servants would instead get US$100 vouchers each that would be used to purchase groceries only, and there was not going to be any issuance of cash.
However, speaking at a press conference at his offices at the New Government Complex, Biti said there has been a review after the first cabinet meeting of the power sharing government on Tuesday, and the vouchers are now redeemable for cash.
He added that business must not come up with "unwanton price adjustments" following the forex payments to civil servants.
"On Tuesday, we paid the army, today we will pay all the teachers. By the end of the day we will have paid them. All the others will be paid tomorrow," the Finance Minister said.
"What was happening at the barracks on Tuesday… you get your voucher, you go to another counter and you get your cash."
Asked where they received the foreign currency, given that Zimbabwe’s fiscus is bankrupt, he replied in Shona: "Takakiyakiya (we came up with a plan)".
Speculation is rife that the money comes from United Nations Children’s Fund (UNICEF) and the United States Agency for International Development (USAID).
The Finance Minister said the foreign currency allowances, which he also referred to as "income", would be reviewed as our situation improves.
"We hope that the private sector will see what government has done," he added.
Banks have been directed to open foreign currency accounts for civil servants beside their local accounts, he also said.
The Central Statistics Office has started compiling data indexed in foreign currency and he hopes that by the end of March, it would have come up with new inflation data.
The Minister said he was going to meet representatives of the Zimbabwe Stock Exchange, which was closed last year, for talks he hopes would result in its re-opening "soon".
"It’s a slow road. I think we will get there…let’s get Zimbabwe working again," Biti said.
It was not immediately clear if the pay offer would pacify unions who have been demanding foreign currency payments of up to US$2,300 for their members.
The Prime Minister and Education Minister David Coltart met representatives of the teachers’ union on Tuesday in a bid to end work boycotts which have disrupted Zimbabwe’s school calendar and left "a generation at risk", according to aid agencies.