Hobeika told Al-Manar Website that a realistic increase of wages is very probable adding that a general strike is not in the interest of anybody

Louis Hobeika to Al-Manar Website:
Correcting Wages Is a Duty…

Compromise to Resolve Crisis Available
General Strike Not in Interest of Anybody
President, PM and Speaker Seek Solution
Realistic Increase of Wages Very Probable
Raise of Prices Pushes for Correcting Wages
Solution Resides in Annual Wage Increase

Economics expert Dr Louis Hobeika revealed a compromise was available to resolve the current crisis over wages between the General Labor Confederation and the business leaders. He proposed a complete correction for the wages based on raising the minimum wage from LL 500,000 to LL 750,000, i.e. by adopting a 50% raise, and decreasing this proportion with every additional LL 500,000 on wages.

In an exclusive interview with Al-Manar Website, Hobeika stressed that correcting the current wages was a duty at the end of the road. He expressed belief that a solution would be reached within the upcoming hours, and ruled out that the GLC announced strike would take place on Wednesday as expected. He stressed that such a strike was not in the interest of any party.

While denying the presence of any link between the rise in prices and the wages, Hobeika highlighted that the normal and logical solution for wages resides in an annual correction of wages which does not exceed a 4 or 5 % raise. He said that this process was applied in developed countries and proved to be healthy and productive.

AGREEMENT IS A MUST
Dr Louis Hobeika told Al-Manar Website that the principle of correcting the wages was a duty. He said that any approach to the crisis between the General Labor Confederation and the business leaders must be based on this main rule, and expressed belief that a positive solution would be reached within the 48 upcoming hours, ahead of the strike set for Wednesday. He said that no party was ready to enter the game of strikes at the current stage, and deduced that agreement was a must and not a choice, in order to avoid the strike.

Hobeika uncovered what he called to be a compromise which would lead to the end of the current crisis between the GLC and business leaders, while expecting, however, that the business leaders might not be satisfied with it. Yet, he said he was assured because President Michel Sleiman, Prime Minister Najib Miqati and Speaker Nabih Berri are seeking to reach solutions, and expressed belief the three leaders would be able to reach the happy endings.

FROM 500 to 750 THOUSAND
While predicting that the GLC would suspend Wednesday’s strike given that it is not in the interest of any party, Hobeika said there was enough consciousness within both parties to avoid anything that would lead to chaos.

Answering a question about the nature of the compromise he spoke of, Hobeika said he has proposed a complete correction for the wages based on raising the minimum wage from LL 500,000 to LL 750,000, i.e. by adopting a 50% raise, and decreasing this proportion with every additional LL 500,000 on wages. He explained that a 50% increase would be set for the first 500,000 of the wage, whereas a 40% increase would be set for the second 500,000, and a 30% increase for the third 500,000 and a 20 % for the forth 500,000 and a 10% increase for the wages exceeding LL 2,000,000.

Hobeika noted that this formula presents a realistic increase of the wages which serves at the same time the workers and the companies without causing inflation. He noted that, according to this formula, whoever actually has a wage of LL 2,450,000 would earn a wage of LL 2,700,000.

FOR AN AUTOMATIC ANNUAL WAGE INCREASE
Answering questions about concerns of possible negative repercussions for any wage increase on the general economic situation given the recorded rise in prices, Hobeika said such scenarios were not realistic. He explained that there was absolutely no link between rise in prices and wage. “Even if we suppose that such link is appropriate, then, this proves the necessity to correct the wages without delay, given that it’s illogical to raise the prices and keep the wages without change,” he added.

Hobeika, who said there was no link at all between wages and prices, also rejected claims of inflation as a result of the wages’ increase as a pretext to escape from the challenge. He said that the essence remains a complete correction of wages. He went on to say that the logical solution is deeper than correcting the wages, as it to adopt a mechanism to annually correct the wages. “If the wages are spontaneously increased by a 4 or 5% rate, a long-term solution would be reached and we would prevent such useless conflicts every 4-5 years,” he explained, as he noted that this solution is adopted in developed countries where it proved to be productive.