South African President Cyril Ramaphosa on Wednesday said he would use the next five years to boost economic reforms in the country and fix ailing state power utility Eskom. The announcement comes just a week after the African National Congress party got re-elected in the election, but with a reduced majority owing to a decade of slow growth and rising joblessness in Africa’s most advanced economy.
“We have to embark on the reforms, speed up,” Ramaphosa told investors at a conference hosted by Goldman Sachs Group in Johannesburg on Wednesday, reported Reuters. “We are going to ensure that the certainty that investors want to see is there.”
The President said the government needs to address the issue of Eskom’s debt as soon as possible. He explained that the power utility’s more than needed labor force was an issue that had to be addressed. He ensured investors that the power utility is too big to fail.
“Eskom is the only company in the history of South Africa that has a debt of R400 billion,” Ramaphosa said. “It is a problem we have to address. Eskom is too big to fail.”
He confirmed that there are no plans to privatize Eskom but restructure it and that the government is willing to collaborate with businesses in certain areas. He assured that the government has a credible business plan to get Eskom out of the mess it is currently in.
“We are not privatizing Eskom, we are restructuring Eskom, a process that will allow the private sector to be our partners – our partners in generation (and) our partners already in distribution,” said Ramaphosa.
He said a “reconfigured cabinet structure” will be announced soon but did not specify that numbers would be cut.
More details on how Ramaphosa intends to implement reforms are expected to be announced in his State of the Nation address, scheduled for next month.
