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Eskom, a South African energy supplier, received a reprieve last week with a $ 2.5 billion US loan from the China Development Bank, which will allow it to keep projectors for the coming year.
Eskom is one of the state-owned enterprises (EPs) that occupies a strategic place in the country's economy, providing about 95% of South Africa's electricity needs. . Eskom is also in debt of 600 billion rand ($ 45.52 billion), more than South Africa 's total budget for health and education.
The utility would be struggling in the coming months until the Chinese advance with the loan package. With the funding in place, Eskom should ensure that operations continue uninterrupted until the next fiscal year.
Monday, Eskom's general manager, Phakamani Hadebe, presented the results of the public service, which showed a loss of 2.3 billion rand operating and "irregular" spending closely 20 billion rand. "Eskom continues to face significant financial and liquidity challenges in the near term, mainly due to high debt, weak sales growth and increased financial costs", said Mr. Hadebe in Parliament
. years of mismanagement and erratic leadership. Mr. Hadebe is his 11th CEO in the last decade. Jacob Zuma, who was president of South Africa until his ousting in February of this year, had packed the boards of Eskom and other public companies with close associates, his Critics allege
Eskom board indebted debt For example, since Cyril Ramaphosa took office at the South African president in February, he appointed Pravin Gordhan to the post of minister of state-owned enterprises. entrusted with the following tasks: erase rot. Mr. Zuma has also been charged with numerous corruption charges, and his associates are under investigation for their activities in state-owned enterprises.
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million. Hadebe was appointed CEO of Eskom in May and his first task was to eradicate corruption and place the institution on a solid foundation. Eskom was eager to raise enough electricity revenue to cover its operating budget for the year.
However, Chinese Prime Minister Xi Jinping was in South Africa last week to attend a Brics summit, during which a $ 2.5 billion loan to Eskom was announced on Tuesday. This amount is part of a broader investment package of $ 14.8 billion announced at the summit. The details of the loan have not been made public, which some analysts question.
"The exact conditions of any loan to a state body, including a public company should be fully disclosed," said Dirk de Vos. energy sector.
In other cases, where Chinese loans were made, such as in Zambia, without conditions being made public, other potential lenders stayed away. Without being able to assess the terms, interest payments and other details, the lenders could not determine the level of risk associated with the Chinese loan.
"This means that no one else will lend them except the Chinese". Your said.
Also uncertain is the fate of plans to build a fleet of nuclear power plants. The Zuma administration had reached an agreement with Russia to supply up to eight reactors, but the current financial constraints make this unlikely. Ramaphosa also met with Russian Prime Minister Vladimir Putin at the Brics summit, and reportedly discussed the nuclear deal.
According to local reports, Ramaphosa told his Russian counterpart that any nuclear construction should wait until Eskom's financial situation improves.
Meanwhile, some analysts have said that rather than being saved, Eskom should be broken and sold to private investors. "Our view is also that you have to break down Eskom, probably into three parts: a production company, another one of transmission and distribution," said Tuesday the Treasurer General of the African National Congress in Cape Town. "It's too big of an elephant, who has trouble walking."
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