Covid-19: Mozambican employers unable to increase minimum wages

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Covid-19: Mozambican employers unable to increase minimum wages

9:07 CAT | 18 Jun 2021

Image: Carta de Moçambique

The Confederation of Economic Associations of Mozambique(CTA), the country’s main employers’ organisation, said on Wednesday that it would not be able to increase minimum wages, since private companies were “in a coma” as a result of Covid- 19.

“Negotiating [minimum wages] in these circumstances is clearly the same as going to negotiate with someone who is in a coma,” said Vasco Manhiça, deputy chairman of the CTA.

“No company is breathing, in good health and, if we currently don’t have the capacity, it is unthinkable for us to enter into a negotiation process,” he added.

According to the CTA deputy chairman Vasco Manhiça, “in the case of adjustments to minimum wages”, it appears that “the reasons which dictated the suspension of the negotiation process last year [still] prevail”.

According to the CTA, the private sector in 2020 “recorded revenue losses estimated at around US$1.1 billion, corresponding to 7% of GDP [gross domestic product], culminating in the suspension of about 90,000 jobs”.

Despite a timid recovery at the end of 2020, “in the first quarter of this year the situation became even more complicated, due to the emergence of the second wave of Covid-19”, Manhiça said.

“National companies continue to feel the negative effects of the adverse context that characterizes our economy, and after an absolutely bleak first quarter, they are currently trying to create bases for their revitalisation,” on the basis of an alleviation of Covid-19 restrictions.

But, “it will not be an instantaneous process”, he warned.

Mozambique has registered a cumulative total of 844 Covid-19 deaths from its total 71,764 cases, 97% of which are accounted recovered, with 32 currently hospitalised.

May registered the lowest number of Covid-19 cases and deaths in Mozambique since the February peak of 274 deaths and more than 20,000 infections.

Although improvements have helped the country enter a new phase of restriction easing, health authorities have called for continued compliance with prevention measures amid fears of a third wave of infections such as that already detected in neighbouring South Africa.

Source: Carta de Moçambique