Bloomberg News reports that Employment & Labour Minister Thulas Nxesi says he will oppose any move to privatise Eskom as it struggles to generate power, avoid outages and repay its R396bn debt.
While President Cyril Ramaphosa’s government has previously denied any plans to sell the company, there have been calls to divest from the asset. According to S&P Global Ratings, privatisation might be the best option to resolve SA’s power crisis. Privatising the company would be detrimental to the poor, Nxesi opined in an interview. Nxesi, who is also deputy national chair of the SA Communist Party (SACP), explained: “I am not a proponent of privatisation of key state assets. If you privatise electricity, you can forget about the majority of people having access to electricity – it is going to be very expensive for them. That’s why government steps in when there is market failure.” Nxesi added that he saw the energy issue as an economic crisis. Operational issues at Eskom pose a risk to SA’s economic outlook and the utility’s revenue is insufficient to reduce its debt. The administration is breaking up Eskom into three separate entities, namely transmission, generation and distribution. Nxesi remarked the ANC could upset South Africans if it was unable to resolve the energy crisis by 2024, when the next general election is set to take place.
- Read the full original of the report in the above regard by S'thembile Cele at BusinessLive
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