Sundaymail Editor
South Africa’s government will take on a portion of struggling state utility Eskom’s debt in a staggered manner to avoid a spike in the country’s debt-to-GDP ratio, Finance Minister Enoch Godongwana said on Thursday.
Eskom has been mired in financial crisis for years and is dependent on government bailouts. It is currently implementing some of the worst power cuts on record, a major source of public frustration with the governing African National Congress (ANC) and a brake on economic growth in Africa’s most industrialised nation. The National Treasury said in October’s mid-term budget that it could take on between one-third and two-thirds of Eskom’s R400 billion debt to try to make the company financially viable. Godongwana said the South African government was committed to the independence of the central bank, after an ANC conference recently resolved to expand the mandate of the bank to explicitly include job creation alongside price stability. – Reuters.
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