Hundreds of Thousands Strike in Tunisia Demanding Higher Wages

(Bloomberg) -- Hundreds of thousands of Tunisian public-sector workers walked off the job Thursday after failing to wrest a wage increase from the cash-strapped government.

About 670,000 people, or near 6 percent of the North African country’s population, were expected to observe the day-long strike called by the powerful Tunisian General Labor Union, or UGTT. It excludes employees in services such as transport and electricity.

Thousands also gathered outside parliament in Tunis to protest, some holding signs that read: “Raises are a right.”

The government is under pressure to cut public spending as part of an economic reform plan agreed with the International Monetary Fund in return for a staggered $2.9 billion loan. Meanwhile, it’s battling the fastest inflation rate in years following a depreciation in the currency and pay increases negotiated for the public sector in 2015.

Social Affairs Minister Mohammed Trabelsi blamed the “difficult economic situation” for the government’s refusal to increase public-sector salaries but left the door open for further talks with the union.

“The decision will be a national one taken after meetings between the government and the union, with no foreign interference,” he told Bloomberg.

The IMF says Tunisia’s public-wage bill is among the world’s highest and accounts for half of the national budget. In October, it said “further monetary tightening” was warranted to reduce inflation and avoid further erosion of the local currency’s purchasing power.

Tunisia’s fragile coalition government has struggled like its predecessors to revive an economy that’s suffered from political upheaval that followed the 2011 uprising against President Zine El Abidine Ben Ali. Terrorist attacks along with repeated strikes by labor groups and political infighting have worked against government efforts to stimulate growth and cut costs, key elements in the IMF-backed turnaround plan.

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