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Rising prices force Tanzania to raise minimum wage

Tanzania minimum wage

Dodoma, (Business News Report)|| Tanzania has approved raising the minimum wage in light of the significant rise in prices, which led to popular protests over the cost of living.

The presidency said in a statement that the President of Tanzania, Samia Soluho Hassan, agreed to increase the minimum wage by 23.3%.

It also raised the salaries of civil servants for the first time since 2016, against the backdrop of high inflation rates in the country, and popular protests over the cost of living.

“The salary increment was approved considering the country’s gross domestic product, domestic revenue and developments in both the local and global economies,” the presidency said.

Since coming to power in 2021 after the death of her predecessor John Magufuli, Hassan has departed from some of his policies by reaching out to the opposition and taking a different approach to combating the Coronavirus pandemic.

Magufuli rejected a wage increase after his election in October 2015 and focused on ambitious infrastructure plans by building ports and railways and relaunching the national airline.

Tanzania’s economy slowed by 4.8% in 2020 and recovered to just 4.9% the following year, after travel restrictions linked to COVID-19 hit the tourism sector, a major source of income in the East African country. The cost of fuel and food has also risen, especially because of the war in Ukraine.

During May Day celebrations, unions and civil servants demonstrated in Dodoma, the capital of Tanzania, to demand a wage increase.

Last year, the International Monetary Fund loaned Tanzania more than half a billion dollars, saying the country faced “urgent” health, economic and humanitarian costs amid the pandemic.

During his reign, Magufuli refused all quarantine and prevention measures, and went so far as to claim that his country was “liberated” from COVID-19 through prayer.

Tanzania was an exception in the global fight against the epidemic, on the other hand, Hassan tried to limit the spread of the epidemic by launching a vaccination campaign in July.

Tanzania’s central bank is close to launching its own digital currency to help counter the rising popularity of cryptocurrencies in the country.

“It’s important for us to provide a central bank digital currency as a safe alternative because many people are being affected by cryptocurrency speculators,” Bank of Tanzania Governor Florens Luoga said in an interview on Monday in Dar es Salaam, the commercial capital. The bank can’t ignore the technological advancement of money, he said.