Power & Energy | |
Power & Energy | |
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Monday, July 22, 2019 / 2:00 PM /
Bukola Akinyele for Proshare WebTV / Header Image Credit: vocfm.co.za
Eskom, the South-African
state-owned power utility company, has received an extra allocation of 59
billion rand ($4.24 billion), to enable it service operations over the next two
years.
According to information sourced
from the South African National Revenue Fund, 26bn rand will be provided for
the 2019/2020 financial year and 33bn rand for the 2020/2021 financial year.
The
bill for approving the allocation to Eskom Power Utility Company is expected to
be presented for discussion to the parliament by the Finance Minister Mr. Tito
Mboweni on Tuesday, July 23, 2019.
It
will be recalled that Mr. Mboweni approved a release of over 17bn rand to
Eskom, to stabilize its operations following initial delays in accessing funds
from China Development Bank.
The
South African government is also mulling other options for financing Eskom, including
a swap of the firm’s debt for government bonds or ring-fencing it in a special
account.
Eskom is responsible for more than 90% of South Africa’s electricity but was forced to implement power cuts this year, failing to generate sufficient profit to meet its debt servicing obligations which now requires state funds to sustain operations.
The
management of Eskom by the South African government has been described as
critical to the nation’s economic stability, considering the huge debts and
structural challenges of the state-owned utility company.
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