BEIRUT

Local

Private sector threatens strike over salary scale

  • Sources say most merchants will not be too keen to close their businesses during the holiday shopping season.

BEIRUT: The Economic Committees will hold an urgent meeting Monday to discuss the possibility of closing all business across the country if the Cabinet refers the controversial salary scale to Parliament for approval.

The meeting will consist of all the leading bankers, merchants and businessmen in Lebanon, and sources said that the participants want to send a clear message to the government of Prime Minister Najib Mikati that the private sector will not remain idle if the authorities try to enact the salary hike in Parliament.

But insiders believe that the call for a general strike may not receive broad support as most businesses and shops want to remain open for the Christmas shopping season to make up for the losses they incurred this year.

“Merchants are pinning hope on this Christmas holiday and they have no intention to shut down for any reason,” a source said.

The Union Coordination Committee, which groups the private and public school teachers as well as civil servants, plan to stage another strike Monday to press the Cabinet to pass the proposal to increase the salaries to Parliament as soon as possible.

The government seems to be caught between a rock and a hard place as it comes under fire from both the private sector and the UCC over the issue of the salary scale.

Mohammad Chocair, the head of the Beirut Chambers of Commerce, reiterated his rejection of any plan to raise taxes on the private sector under the pretext of funding the wage hike for public school teachers and civil servants.

He added that raising taxes under the current severe economic slowdown in the country would further exacerbate the situation and deal a final blow to all sectors.

Central Bank governor Riad Salameh has also cautioned the government against passing the salary scale or raising taxes under the current difficult conditions.

The governor feared that inflation would soar by 2 to 3 percent and the balance of payments deficit would exceed $2 billion each year if the bill was passed.

Salameh has instead proposed enacting the salary increase in installments over the next three to five years to reduce the negative effects on the economy and the monetary system.

Mikati assured several times that the proposed taxes will not have any impact on low income families or the private sector.

But Economy and Trade Minister Nicolas Nahas told The Daily Star earlier that the chances of passing the bill are very small, if not impossible.

He added securing funds on short notice is nearly impossible, noting that this issue should be studied by all concerned sides before making a commitment to the salary scale.

The International Monetary Fund has praised the government’s reluctance to make any commitment to the salary scale, warning that increasing spending would gravely affect the public debt in the short and medium terms.

 
A version of this article appeared in the print edition of The Daily Star on December 07, 2012, on page 5.
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