Zimbabwe mining workers to get a meager 3% salary rise

Mine companies operating in Zimbabwe including Rio Tinto Plc and Impala Platinum Holdings Ltd. have agreed to raise minimum pay for workers by 3 percent, according to a circular verified by a union official.

While the agreement is below the 10 percent raise the Associated Mineworkers Union of Zimbabwe initially demanded for platinum and diamond miners and 6 percent for other minerals mine companies had proposed a wage freeze, a circular from the Chamber of Mines showed.

The increase, which compares with a 1.3 percent annual decline in prices in January, comes as Zimbabwean companies struggle with increased taxes as the country is struggling to meet a government workers wage bill that accounts for about 88 percent of the budget. Rio Tinto has told staff that the taxes threaten the viability of its Murowa diamond mine.

"We have just agreed to this because employers were saying government and the central bank have said there shouldn't be any salary increases this year," Tinago Ruzive, secretary general of the union, said in an interview, confirming other details in the document.

Zimbabwe has the world's biggest platinum and chrome reserves after South Africa as well as deposits of diamonds, iron ore, gold, coal and nickel.