Ghana increases 30% salaries amid economic woes

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Ghanaian government and trade unions have agreed to increase all public servants’ salaries by 30 percent for 2023, they said in a joint statement, as the country struggles to reduce debt and tackle rampant inflation.

Trade unions representing public service employees started negotiating salary rises with the government in November, a few months after hardship spurred street protests that pushed the government to seek help from the International Monetary Fund (IMF).

The two parties settled on a 30 percent increase to base pay across the board, effective from 1st January, 2023.

The West African gold, oil and cocoa producer, once described as Africa’s shining star by the World Bank, is  battling its worst economic crisis in a generation, with inflation hovering at a record 50.3 percent, the highest in 21 years.

The local cedi dropped heavily against the US dollar last year as government spending cuts and central bank interest rate hikes failed to tame inflation, which rose to a new high of 54 percent last month.

Ghana’s government announced sweeping spending cuts in March, including a lowering of ministers’ salaries, to reduce the deficit, contain inflation and slow the cedi’s slide.