The National Treasury proposes selling Eskom’s coal powered plants to reduce debt

SOUTH AFRICA - Report 30 Aug 2019 by Iraj Abedian

The Finance Minister, Tito Mboweni, has in the past remained quite vocal about the fiscal stress the country’s State-Owned Entities (SOEs) have placed on the economy, especially Eskom. The embattled power utility has not only been struggling to keep lights on, but has also been unable to meet its financial obligations. This has led to it continuously asking for government bailouts. As such, government debt has been on an increase, estimated to reach about 65% of GDP in 2023, and increasing to more than 70% when taking into account guarantees to the debt-ridden Eskom. Certainly, Eskom remains a fiscal risk, even to the country’s sovereign credit rating.

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