Business writer
The Zimbabwe Congress of Trade Unions (ZCTU) has expressed concern over continuous businesses closures which have left workers jobless.
ZCTU acting Secretary General, Runesu Dzimiri warned that the current companies closure is a catalyst for political instability.
“The Zimbabwe Congress of Trade Unions notes with serious concern widespread reports of companies that are either scaling back or are totally closing due to the harsh economic situation the country is facing , throwing thousands of workers onto the streets,” said Dzimiri.
“Latest reports indicate that the retail and wholesale sector is facing serious operational challenges with some already closing shop, scaled down and some exiting the Zimbabwe market.
As a result, thousands of workers have been retrenched while those who remain are uncertain about their future.
“The companies that are closing are all citing skewed fiscal and monetary policies that are pushing the retail sector out, including imports of not only cheap, but also fake goods that are being sold in the informal sector.While those who are importing these cheap goods are not paying any taxes, formal shops are forced to pay hefty taxes forcing them to bankruptcy,” he added.
Dzimiri said government must take into consideration the impact of the retail sector collapse in the country.
“The government must realise that there is serious impact on the economy if the wholesale and retail sectors are left to collapse.First when jobs are lost, government will also lose revenue not only on corporate taxes, but also in the form of Pay as you earn (PAYE) and it will also fail to meet its operational requirements as well as meeting social services.As PAYE is depleted , the Value Added Tax will also be eroded as workers will not have disposable income.
” Secondly pension schemes both private and public will be affected as every employee whose contract is terminated will look up to government for social welfare, but resources are scarce at the moment. Lack of access to social protection and benefits usually associated with full time employment leaves employees vulnerable and dependant on the already strained public service provisions,”said Dzimiri.
He added:
“Thirdly the general condition of fear and insecurity also dissuades workers from joining trade unions, leaving them even more vulnerable to precarious work arrangements.Companies will also be in unstable and insecure situations due to disruptions of their life span.As large people are unemployed, social unrest may occur in the country including increased criminal activities.Large scale migration is also likely to take place causing xenophobia in other countries.”
Dzimiri said the government must act decisively.
“The ZCTU on behalf of the workers of Zimbabwe therefore demands the government to move fast and address the situation and immediately stop the current wave of company closures.The ZCTU warns the government that the current carnage in the retail and wholesale sector is a receipe for political instability as disgruntled workers will turn against their government for failure to protect them,” said Dzimiri.