25 January 2019

South Africa: Eskom, State Capture and a Plan to Keep the Lights On

Photo: allafrica.com
Top: Eskom Megawatt Park. Bottom-left: Public Enterprises Minister Pravin Gordhan. Bottom-right: President Cyril Ramaphosa.
analysis

Daily Maverick takes a look what's at stake amid all the Davos talk of renewal, credible turnaround strategies and growth.

President Cyril Ramaphosa told the annual World Economic Forum shindig at Davos, Switzerland, that a plan to keep Eskom switched on was in the making. 'In the next few weeks, we will be announcing a set of measures to stabilise and improve the company's financial position and to ensure uninterrupted energy supply.' It's not exactly new, given the end of January deadline he had set for the Eskom sustainability task team appointed in mid-December 2018. But his comments, crucially, were made on an international platform amid a drive to rustle up more investment for South Africa.

How bad is it at Eskom, financially-speaking?

The financial position of South Africa's power utility was "a major risk to the economy and the public finances", according to the 2018 Budget Review. And that was before the release in mid-2018 of Eskom's annual report for the year ending 31 March 2018 showed losses of R2.3-billion and an increase in irregular expenditure to R19.6-billion.

The subsequent interim results for the year ending 30 September 2018, which were published in late November 2018, revised the forecast...

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