Kenya boosts minimum wage as inflation bites

Kenyan President Uhuru Kenyatta announced Sunday a 12-percent hike in the minimum wage as the country confronts a surge in the cost of living.

Inflation in the East African economic powerhouse jumped to a seven-month high in April, mainly as a result of skyrocketing fuel and food prices, according to official figures.

"As a caring government, we find there is a compelling case to review the minimum wages so as to cushion our workers against further erosions," Kenyatta said at a Labour Day rally.

He said the 12 percent increase would come into effect from May 1. It takes the minimum monthly wage from 13,500 Kenyan shillings (about $116.5, 110.5 euros) to 15,120 shillings ($130.5, 124 euros).

© Yasuyoshi CHIBAPresident Uhuru Kenyatta said the high cost of living was due to factors beyond his control such as the Ukraine war and the Covid pandemic

However the hike falls far short of the 24 percent that had been sought by the Central Organisation of Trade Unions-Kenya (COTU).

Gallery: Moscow's stock market saw its longest shutdown, the ruble crashed 30%, and oil surged toward $120 as sanctions bit. Here are the top 10 seismic market moments after Russia invaded Ukraine. (INSIDER)

Gallery©REUTERS/Anton Vaganov

Moscow's stock market saw its longest shutdown, the ruble crashed 30%, and oil surged toward $120 as sanctions bit. Here are the top 10 seismic market moments after Russia invaded Ukraine.

• Russia shut its stock market all week in a bid to curb panic-selling after the invasion of Ukraine.
• The ruble cratered to trade below 1 cent as Western sanctions effectively weaponized the financial system.
• These are the top 10 seismic market moments in the days after Russia's incursion into Ukraine.

Russia's devastating attack on Ukraine last week was the start of a cascade of dark events, bringing misery to countless civilians — and turmoil to financial markets.

The full-scale invasion on February 24 — the largest attack on European soil since World War II — has drawn strong condemnation from the US and its NATO allies.

It's also brought a string of sanctions from them, aimed at isolating the Russian economy from the rest of the world.

That disruption has the potential to hurt households everywhere, as their energy bills and the cost of food are pushed up by rises in commodity prices.

Russia is the world's second-largest oil producer, and the region is known as the "breadbasket of the world" for its wheat and corn crops.

The hostilities prompted widespread volatility in asset prices, as investors reacted to fresh news headlines. Over the week, they had to recalibrate their expectations as a string of ever-tougher sanctions on Russia came in.

We broke down the 10 most seismic market events in the days following Russia's invasion of Ukraine:

Kenyatta said the high cost of living was due to factors "beyond my control like the coronavirus pandemic and the Russia-Ukraine conflict".

  He castigated rival political leaders -- including Deputy President William Ruto -- for seeking to blame the government for the economic woes, as the country prepares for crucial elections in August.

Kenyatta cannot run again after serving two terms but has endorsed his former arch-rival Raila Odinga for the top job.

The August 9 presidential election is expected to be a two-horse race between Odinga and Ruto, who was initially anointed by Kenyatta as his successor, but found himself frozen out after a shock 2018 pact between Kenyatta and Odinga.

Kenya's finance minister last month unveiled a $28 billion budget aimed at helping the economy recover after the Covid-19 pandemic threw hundreds of thousands of people out of work.

Kenyans are struggling to cope with rising costs of basic goods such as food and fuel, a crisis exacerbated by the Ukraine war, while several parts of the country are also suffering from a severe drought.

Inflation reached a seven-month high of 6.47 percent last month from 5.56 percent in March and 5.76 percent in April last year, the statistics bureau announced last week.

Last month the country was also hit by a fuel shortage that triggered long queues at petrol stations and strict rationing.