More money needed for power utility, Treasury tells G20

Addressing a meeting of the international Group of 20 forum comprising finance ministers and central bank governors in Fukuoka, Japan, national treasury director Dondo Mogajane said South Africa had no option other than increasing its financial support for Eskom.

His comments come on the back of a R69-billion three-year bailout plan that government announced earlier this year, and that power utility chairman Jabu Mabuza and finance minister Tito Mboweni have since said is “not enough”.

Mogajane indicated that government was very sensitive to how Eskom’s $30-billion debt was viewed by ratings agencies and that every effort would be made to improve the parastatal’s precarious position.

He said that financial cushioning might have to come from “tax revenues, money that should have gone to other things”.

Government is expected to soon pronounce how it intends to free up liquidity for Eskom.

“That’s a decision that we’ll have to finalise, but we know that we don’t have a choice. It’s an issue of how much and when.”

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