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Eskom debt swap proposal gets cold shoulder from Ramaphosa

Dec 13 2018 21:19
Mike Cohen, Bloomberg

President Cyril Ramaphosa signalled he doesn't back a proposal from the struggling state-owned power utility Eskom for the government to assume a large portion of its debt.

There are a number of options being considered to solve Eskom's large debt burden, he said in an interview Thursday with Johannesburg-based Talk Radio 702. Eskom has told bond investors it wants the government to take on about R100bn of its debt.

"The debt swap that Eskom has come up with is just going to descend us into further deeper debt as a country," Ramaphosa said. "So, we have said we need to look at a number of other options."

Ramaphosa will announce a task team to consider solutions for Eskom on Friday, he said. The team will look at Eskom's current challenges, after the company was forced to implement rolling blackouts, as well as its business and funding models.

Ramaphosa also said he will announce a special presidential council on state-owned enterprises Friday.

During the interview he said corruption in some state companies had reached a "horrifying" level and the issue will be addressed. He said those responsible will be jailed once due process has run its course.

eskom  |  cyril ramaphosa  |  sa economy


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