Zimbabwean Bankers Want Some Pay in Dollars as Inflation Soars

HARARE (Capital Markets in Africa) — Bankers in Zimbabwe are demanding that part of their salaries be paid in dollars to cushion themselves against soaring inflation and a depreciating currency.

Workers are asking that their pay be based on what they were earning in 2018, Shepard Ngandu, assistant secretary-general of the Zimbabwe Banks and Allied Workers’ Union, said by phone on Monday. Receiving pay in the local currency is of no value because of the dollarization seen in the economy, he said.

The country is struggling with food and fuel shortages, an annual inflation rate of about 786%, and a local currency that has imploded since being reintroduced last year after a decade-long hiatus.

“Not all banks generate foreign currency and others won’t be able to afford such a request,” said Ralph Watungwa, president of the nation’s Bankers Association. “Due to digitization, there should be a request that there should be consolidation of the industry to protect jobs, as some banks would simply close their branches if this request is followed through.”

At least 60% of costs for the banking industry are related to staff, he said.

Banking employees who aren’t managers were awarded a sixfold salary increase in March, taking the minimum salary to 5,820 Zimbabwean dollars ($88) a month, according to the labor union. In 2018, the minimum wage was $626, the union’s Ngandu said.