About-turn on state's Telkom stake raises questions about where it will get SAA money
With less than two weeks to go before Finance Minister Malusi Gigaba tables the medium-term budget policy statement in Parliament the government has abandoned its plans to sell its shares in Telkom, leading to questions on how it will raise the funds needed for South African Airways (SAA).
The Treasury has committed to funding state-owned enterprises in a deficit-neutral way to contain their burgeoning debt, which is listed among the top risks to government finances by credit-ratings agencies.
The government had indicated that it was considering a sale of its 39% stake in Telkom, valued at about R13bn, to repay lenders and provide urgently needed working capital.
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