Congo Republic to hike public sector salaries 25 pct

[preme3000]

Congo Republic to hike public sector salaries 25 pct

BRAZZAVILLE (Reuters) - Congo Republic will give all public sector workers a 25 percent pay rise to mark the 50th anniversary of its independence from France, the central African country said on Friday.

The oil-producing nation of around 4 million people employs 60,000 state workers, whose minimum salary is 50,000 CFA francs per month.

"The minimum salary in the public sector will rise by at least 25 percent," President Denis Sassou-Nguesso said in a national address as part of the August 15 anniversary celebrations.

"This is a great present ... For a long time our salaries have been low, while the cost of living has risen," said teacher Claude Goma.

Congo doubled its national budget in 2010, banking on an increase in petroleum revenues to improve infrastructure and combat poverty, but its government has since come under pressure from donors to keep spending in check.

The Paris Club of sovereign creditors and Brazil agreed earlier this year to write off all of the country's debt in a deal worth around $2.4 billion.

In January, the International Monetary Fund said the government should limit spending to avoid being forced to borrow and thereby running up debt again.

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[Pius]

Originally Posted by preme3000

Congo Republic to hike public sector salaries 25 pct

At first consideration, this decision appears to be laudable; a sign of government’s determination to redistribute the national wealth to its rightful owners: the people. Is this a great example of social justice? Yes, but only in appearance.

Unfortunately, this decision is illustrative of many flaws that are plaguing governance in Africa today. A 25% salary increase for all civil servants might be generous but will that not trigger an inflation hike, which will bring the beneficiaries back to square one? Why not increase the salaries progressively?
Doubling the national budget and going on a spending spree in the hope that oil price will keep increasing, whereas economic recovery in the world is still shaky, is a recipe for failure. The Republic of Congo did this already in the 1970s and 80s and it went bankrupt, with a bloody civil war in the 90s as the cherry on the cake, so to speak. Here they go again…This is the curse of a rent-seeking economy based on oil revenue. If I were a Congolese civil servant, I would not jump for joy for this poisoned chalice.