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Jan 8, 2010 (DVB), A salary increase for civil service workers in Burma is necessary but will severely strain the country's budget and "damage the public", a Burmese trade union coalition has said.
Nearly two million people are set to benefit from the rise, which was announced by the government at the end of last year and could in some cases more than double low-income salaries.
But myopic government spending on the military and infrastructural development projects, along with the billions channeled into building the new capital, Naypyidaw, has weakened the Burmese economy, despite its considerable sales of energy and natural resources.
"Suddenly increasing the salary without any adjustment to the economic sector could bring about bad consequences, such as a hike in commodity prices and inflation," the Federation of Trade Unions Burma (FTUB) said in a statement.
Inflation in Burma, one of the world's poorest countries, is already at nearly 30 percent, while annual GDP growth rate, according to the World Bank, is 12.7 percent.
All civil service workers receiving between the lowest monthly wage of 15,000 kyat ($US15) to the mid-level 80,000 kyat ($US80), will get an additional 20,000 kyat ($US20) each. According to the US State Department, the average annual wage for Burmese citizens is less than $US200.
Analysts have said that, with the Burmese elections looming this year, the salary hike is a means for the junta to secure crucial votes from the army and government employees.
That view was however refuted by renowned Burmese economist Khin Maung Kyi, who said that there was "nothing surprising" about the government's decision to "satisfy workers".
The FTUB said however that the increase "is the successful outcome of non-violent struggles by the workers and the privates in the army" following lasting dissatisfaction with the inordinately low wages.
It added that the government should have included civilian workers, labourers and farmers in the increase.
"This is completely opposite to the suggestion made by Nobel laureate Joseph Stiglitz, who visited Burma on December 15, 2009, who said that conditions for farmers in the country should be improved in order to fuel economic development."
Reporting by Francis Wade