US embassy cable - 03HARARE1009

UNCLAS HARARE 001009 
 
SIPDIS 
 
STATE FOR AF/S 
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER 
USDOC FOR 2037 DIEMOND 
PASS USTR ROSA WHITAKER 
TREASURY FOR ED BARBER AND CWILKENSON 
DEPARTMENT PASS USAID FOR MAJORIE COPSON 
 
E.O. 12958: N/A 
TAGS: ELAB, ECON, PGOV, ZI 
SUBJECT: Labor Strike Updates 
 
Ref: Harare 135 
 
1. Summary: Public and private sector strikes are on the 
rise.  Given the state of this free-falling economy, 
however, it is doubtful many workers will come out ahead. 
End Summary. 
 
2. Public school teachers recently lost a court ruling and, 
on instruction from the Zimbabwe Teachers' Association 
(ZIMTA), are returning to work.  They had been striking 
since May 8, demanding a salary increase from Z$ 60,000 (US$ 
29) to Z$ 268,000 (US$ 128)/month.  Workers at electricity 
parastatal ZESA began striking on May 20, asking for 50 
percent across-the-board increases.  The GOZ recently met 
most demands of striking Air Zimbabwe engineers, boasting 
salaries about 300 percent to as high as Z$ 430,000 (US$ 
205)/month (ref). 
 
3. There have also been assorted cases of private sector 
labor unrest.  Most recently workers at Standard Bank 
Zimbabwe have threatened to strike if management does not 
meet demands for a 65 percent cost-of-living adjustment. 
Many security companies, who generally pay guards less than 
US$ 10/month, are also facing strikes.   Most multinationals 
we speak with now readjust worker salaries each quarter. 
 
Comment 
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4. With inflation raging at 269 percent and the Zimdollar 
having lost 84 percent of its value in a year, workers are 
fighting a losing battle.  The GOZ considers indexing 
salaries to hard currency or inflation a taboo topic.  In 
U.S. dollar terms, salaries of the highest paid AirZim 
engineers have already shrunk from $ 289 to 205 since the 
GOZ caved in to union demands in January.  By the end of 
2003, the engineers may be earning less than before the 
strike began.  Still, given the plight of the Zimbabwean 
worker, we expect growing numbers of public and private 
sector strikes. 
 
5. The AirZim strike shows that the GOZ will meet worker 
demands when it makes financial sense.  AirZim was paying 
South African engineers US$ 55/hour to replace Zimbabwean 
workers, so the GOZ had every reason to settle with workers 
for any price in its monopoly-money currency.  Given the 
sensitivity of electricity parastatal ZESA, local sources 
believe chances are good the GOZ will cede to demands.  On 
the other hand, since the GOZ considers many teachers 
staunch Movement for Democratic Change (MDC) supporters, 
labor sources believe the teachers will have more of an 
uphill climb. 
 
Whitehead