Salameh: Wage Hike Would Require Liquidity Measures
Central Bank governor Riyad Salameh has warned that the cabinet’s wage boost decision could lead to a rise in inflation which already reached 4 percent in 2011.
In remarks to LBC TV on Sunday, Salameh said the inflation rate last year was at 4 percent while the debt rose to 54 billion dollars.
“The increase in wages could lead to additional inflation which would force us to take the necessary measures to adjust the policy of liquidity,” he added.
The cabinet approved last month the wage hike proposal made by Labor Minister Charbel Nahhas. It calls for raising the minimum wage to LL868,000 from the current LL500,000 – a sum that includes a LL236,000 transportation allowance.
The decision also says that workers earning less than LL1.5 million should receive an 18 percent increase while salaries between LL1.5 million and LL2.5 million should receive an additional 10 percent on the second salary bracket. Wages above LL2.5 million will not earn an additional raise.
The raise is effective as of Dec. 1, 2011. But the Shura Council has yet to issue its stance on it.