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Ex-Eskom chairman pushed for the signing of flawed Chinese loan

Mar 02 2019 10:18

Former Eskom chairperson Zethembe Khoza put pressure on former Eskom interim CEO Sean Maritz to sign off on a controversial loan agreement with a Chinese firm Huarong Energy Africa, the Zondo Commission of Inquiry into State Capture heard on Friday.

Evidence presented by Eskom treasurer, Andre Pillay, revealed that the inking of the flawed loan worth $2bn was not supported by the board and was also not backed by a government guarantee.

Pillay told the commission that he had raised his discomfort over the facility with Maritz, and his response was that “the chairman is putting pressure on me to sign”.

The signing triggered a R400m signing fee.

“In the lead up to the signing, I did not cooperate with the process,” he said. The inquiry earlier heard from Pillay that the term sheet for the unsolicited agreement was signed in March 2017 by former Eskom financial officer Anoj Singh and the chairperson of Huarong.

Pillay said three days after the signing of the Huarong deal, Eskom was presented with an invoice to pay. He gave an instruction for it not to be paid.  Maritz resigned from Eskom in March 2018, as the power utility was in the process of a disciplinary process against him.

He faced allegations of impropriety and Eskom said the disciplinary process to hold Maritz to account for any proven wrongdoing can no longer be pursued in light of his resignation.

Pillay stated that the transaction was favoured by the former Public Enterprises Director General who told Eskom officials to look east for funding.

“He made a comment that the problem with you people is that you are looking to the west for funding, it’s time you look in the east,” he said.

Pillay also mentioned that Eskom officials were responsible for drafting the corporate plan for the transaction but was surprised to learn that consulting firms Trillian and McKinsey were paid for the job. The inquiry will resume on Monday.

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