ESKOM’s R420 Billion Debt Chokes ANC’s 2019 Election Campaign
ESKOM’s R420 Billion Debt Chokes ANC’s 2019 Election Campaign

JOHANNESBURG – With exactly 77 days before South Africa’s 6th general elections are held on 8 May 2019, ESKOM’s financial woes threaten to choke the ruling party’s election campaign momentum, ENN reports.

The 95 year old South African electricity public utility (ESKOM) is reeling in a R420 billion debt and was criticised by national unions last week following the collapse of six of its power generating units last week, resulting in increased load shedding in the mineral rich Southern African country.

As the ESKOM crisis deepens, Democratic Alliance (DA) leader Mmusi Maimane’s documented reservations and parliamentary arguments over ESKOM’s loans and deals are beginning to unfold. In their SONA debate recently, both Maimane and Malema slammed the impact of ESKOM’s power challenges on business and urged government to live within its means by reducing its cabinet size.

In typical bourgeoisie style, ESKOM prioritised new plant acquisitions ahead of the all-important maintenance of existing plant and equipment as confirmed by Eskom’s Andrew Etzinger. Consequently, plant maintenance costs were reduced by 50% over the last 5 years due to financial constraints.  “Money was prioritised completely to the construction of the new power plants, we are now paying the price for that whereby we are seeing unreliability of our older power stations,” said Andrew Etzinger.

After assuming national leadership in February 2018 as the ruling party’s representative (ANC), Soweto-born Ramaphosa launched his party’s election manifesto in January 2019 underpinned on economic inclusivity as expressed by a citation from his manifesto launch speech below.

SA President and ANC 2019 Presidential candidate Cyril Ramaphosa

 “Today, we are launching a manifesto for an inclusive economy. For centuries, the majority of South Africans have been deliberately excluded from economic activity, dispossessed of land, deprived of skills and forcibly settled far from economic opportunities. This exclusion is greatest among women, rural people and youth. We will build an economy in which all our people have a meaningful stake and from which they can all benefit. We will enable workers to own stakes in the companies they work for and to share in the profits. We will open up markets for new, emerging companies by ending monopolies and behaviour that stifles competition.’

Recent events at ESKOM are a total opposite of what President Ramaphosa’ s  manifesto articulates as businesses and citizens are excluded from the national power grid as the public power utility company struggles with ageing infrastructure and the impact of poor maintenance of plant and equipment.

Ramaphosa inherited a country with underlying economic challenges, and has vowed to fix them through fostering inclusivity in South Africa’s nation building efforts. Under President Cyril Ramaphosa’ s 11 month reign in year 2018, foreign direct investment to South Africa grew by 446% to US$7.1 billion in 2018.   

With a 30 day supply of coal left at ESKOM and the authority’s announcement that the power grid has now stabilised, does this power poser give credence to ANC’s electoral promises to the people of South Africa?

South Africa Fact File

South Africa is Africa’s most advanced and richest economy. The country is located on the southernmost tip of the African continent and is the world’s largest producer of chrome, manganese, platinum, vanadium and vermiculite. It is also one of the world’s leading producers of gold, diamonds and coal. Ranked number 82 out of 190 economies in the latest World Bank ease of doing business, South Africa is also ranked 73rd on corruption and 67th on competitive rankings. With an estimated national population of 57.7 million, South Africa spans a surface area of 1.22 million square kilometres. South Africa’s GDP is forecasted to reach US$390 billion by the end of the first quarter of 2019.