Government confirms Chinese loan to Eskom not in jeopardy
The public enterprises ministry said on Thursday that a China Development Bank (CDB) loan to struggling state-owned Eskom is not in jeopardy.
Eskom had expected to draw down R7bn from a $2.5bn CDB loan facility by late March, but the finance ministry said in a report to parliament last month that the drawdown had been delayed.
The delay meant the government had to bring forward a planned bailout for Eskom, which supplies more than 90% of the country’s electricity, but which has been grappling with a severe financial crisis.
The government and Eskom are working to ensure the transfer of funds from CDB to Eskom, the public enterprises ministry said in a statement.
“It must be emphasised, for the sake of clarity, that this, or any other loan, is in no way connected to the issue of equity in any of our state-owned enterprises,” the statement said.
The Chinese loan to Eskom was agreed in July last year, during a visit to SA by Chinese President Xi Jinping.
Eskom, which is battling with liquidity problems, has been promised a government bailout of R23bn a year over the next three years — but energy experts say it will need more support.