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Friday, August 12, 2022

Kenyatta Announces Minimum Wage Increase as Kenya Grapples Inflation

Kenyan President, Uhuru Kenyatta announced a 12-percentage-point increase in the minimum wage on Sunday, as the country grapples with inflation.

According to official estimates, inflation in the East African economic superpower reached a seven-month high in April, owing primarily to soaring fuel and food prices.

“As a caring administration, we believe there is a compelling reason to revisit the minimum wage in order to protect our employees from future erosions,” Kenyatta said at a Labor Day rally.

He stated that the 12% rise would take effect on May 1. It raises the minimum monthly pay from 13,500 Kenyan shillings (about $116.5, 110.5 euros) to 15,120 shillings (approximately $130.5, 124 euros).

However, the hike falls far short of the 24 percent that had been sought by the Central Organisation of Trade Unions-Kenya (COTU).

Kenyatta said the high cost of living was due to factors “beyond my control like the coronavirus pandemic and the Russia-Ukraine conflict”.

AIHS 2022

He castigated rival political leaders — including Deputy President William Ruto — for seeking to blame the government for the economic woes, as the country prepares for crucial elections in August.

Kenyatta cannot run again after serving two terms but has endorsed his former arch-rival Raila Odinga for the top job.

The August 9 presidential election is expected to be a two-horse race between Odinga and Ruto, who was initially anointed by Kenyatta as his successor but found himself frozen out after a shock 2018 pact between Kenyatta and Odinga.

Kenya’s finance minister last month unveiled a $28 billion budget aimed at helping the economy recover after the Covid-19 pandemic threw hundreds of thousands of people out of work.

Kenyans are struggling to cope with rising costs of basic goods such as food and fuel, a crisis exacerbated by the Ukraine war, while several parts of the country are also suffering from a severe drought.

Inflation reached a seven-month high of 6.47 percent last month from 5.56 percent in March and 5.76 percent in April last year, the statistics bureau announced last week.

Last month the country was also hit by a fuel shortage that triggered long queues at petrol stations and strict rationing.


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