HILARY JOFFE: Markets will closely watch the assistance that Eskom receives
The power utility has long argued that it needs to get about half of its debt off its balance sheet
It is more than four years since Eskom asked the government to help relieve it of its unsustainable debt burden, and the government undertook to do so. Now the Eskom debt issue is on the table again. Finance minister Enoch Godongwana has made it clear the government plans to take on a portion of the Eskom debt. He will outline the principles in his medium-term budget later this month.
Markets will be closely watching the how much and the how. But the why is not altogether obvious. Eskom doesn’t generate enough cash to service its debt of almost R400bn; it has long argued that it needs to get about half of this off its balance sheet...
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