Inflation is hovering at a document 50.3 % in Ghana, as soon as described as Africa’s shining star by the World Financial institution.
Ghana’s authorities and commerce unions have agreed to extend all public servants’ salaries by 30 % for 2023, they stated in a joint assertion, because the nation struggles to cut back debt and sort out rampant inflation.
Commerce unions representing public service workers began negotiating wage rises with the federal government in November, a number of months after hardship spurred avenue protests that pushed the federal government to hunt assist from the Worldwide Financial Fund (IMF).
The 2 events on Thursday settled on a 30 % improve to base pay throughout the board, efficient from January 1, 2023.
The West African gold, oil and cocoa producer, as soon as described as Africa’s shining star by the World Financial institution, is battling its worst financial disaster in a technology, with inflation hovering at a document 50.3 %, the very best in 21 years.
The native cedi dropped closely towards the US greenback final yr as authorities spending cuts and central financial institution rate of interest hikes did not tame inflation, which rose to a brand new excessive of 54 % final month.
Ghana’s authorities introduced sweeping spending cuts in March, together with a decreasing of ministers’ salaries, to cut back the deficit, comprise inflation and sluggish the cedi’s slide.
Nevertheless it additionally elevated the price of dwelling allowance for public employees by 15 % in July, citing the impact of “world challenges” on residents.
Ghana secured a staff-level settlement with the IMF for a $3bn, three-year assist bundle in December. Nevertheless it must restructure its debt to entry the funds.
The federal government launched a home debt alternate programme final month and later stated it could default on almost all of its $28.4bn of exterior money owed.
It requested to restructure its bilateral debt underneath the G20 frequent framework platform this week.