bailout - The African Mirror

Mar

18

2023

South Africa’s bailout of Eskom won’t end power cuts: splitting up the utility can, as other countries have shown

THE announcement by the South African finance minister, Enoch Godongwana, of debt relief for the country’s troubled power utility, Eskom, is a step forward. It will fix one problem: Eskom has too much debt. But the plan won’t end power cuts which have worsened in recent years. The international experience is that one way to end electricity shortages is to allow competitively-priced privately-funded generation at scale. This requires a reorganisation of South Africa’s electricity market along the lines announced by the Department of Public Enterprises nearly four years ago. The crux of the plan was to split Eskom into three…

Mar

18

2023

By The African Mirror

South Africa’s bailout of Eskom won’t end power cuts: splitting up the utility can, as other countries have shown

SPECIAL FEATURES: ANALYSIS

THE announcement by the South African finance minister, Enoch Godongwana, of debt relief for the country’s troubled power utility, Eskom, is a step forward. It will fix one problem: Eskom has too much debt. But the plan won’t end power cuts which have worsened in recent years. The international experience is that one way to end electricity shortages is to allow competitively-priced privately-funded generation at scale. This requires a reorganisation of South Africa’s electricity market along the lines announced by the Department of Public Enterprises nearly four years ago. The crux of the plan was to split Eskom into three…

Sep

09

2021

By The African Mirror

South African state insurer in talks over larger bailout

BUSINESS

SOUTH Africa's state-owned insurance company Sasria is in talks with the National Treasury for a larger bailout than the 3.9 billion rand ($272 million) already promised, its managing director has told a parliamentary committee. Sasria, the only insurer covering political violence in Africa's most advanced economy, has suffered a sudden deterioration in its financial position after some of the worst violence in the post-apartheid era erupted in July soon after the arrest of former president Jacob Zuma. More than 300 people died and around 3,000 shops were looted in the immediate aftermath of Zuma's arrest, with anger over entrenched poverty…

Sep

20

2020

By The African Mirror

Banks agree $545 million for Congo Republic economy

BUSINESS

A group of banks has agreed more than $545 million worth of funding to boost Congo Republic's long-suffering economy, officials have said. The oil-producer was hit by a sharp drop in crude prices in 2014, leaving it with debt of nearly $9.5 billion, much of it owed to China and Western oil traders and amounting to 85.5% of the Central African country's gross domestic product (GDP). The IMF agreed a three-year $449 million bailout last year, but the coronavirus pandemic is expected to cause an economic contraction of 9% in 2020, the government has said. A group of banks including…

Sep

02

2020

By The African Mirror

South African state firms request bailouts over COVID-19

COVID-19

South African state companies have requested billions of rand in funding from the government to help them weather the impact of the coronavirus crisis, a finance ministry presentation to parliament showed on Tuesday. Loss-making state companies have long been an Achilles heel for Africa’s most industrialised economy, requiring bailouts that have placed its public finances under huge strain at a time of weak economic growth and helped push its sovereign credit rating to “junk” status. The South African Post Office had requested 4.9 billion rand ($292.87 million) in support, broadcaster SABC was seeking 1.5 billion and airports company ACSA had…