Bulletin: Government Support Continues To Underpin The Liquidity Of South African Electricity Utility Eskom

JOHANNESBURG (S&P Global Ratings) Oct. 31, 2019--South Africa's Ministry of Public Enterprises on Oct. 29, 2019, released its "Roadmap for Eskom in a Reformed Electricity Supply Industry," and on Oct. 30, 2019, the Ministry of Finance released the country's "Medium Term Budget Policy Statement" (MTBPS). We view these statements, which were broadly in line with an expected measured approach to sector reform and government support, as providing some clarity on government policy in relation to 100% state-owned electricity utility ESKOM Holdings SOC Ltd.(Eskom; CCC+/Stable/--; zaB/--/zaB) for the next three years. The announcements do not have an immediate impact on S&P Global Ratings' rating or outlook on Eskom. The MTBPS confirmed Eskom's government support package of South African rand (ZAR)69 billion

...October 31, 2019 JOHANNESBURG (S&P Global Ratings) Oct. 31, 2019--South Africa's Ministry of Public Enterprises on Oct. 29, 2019, released its "Roadmap for Eskom in a Reformed Electricity Supply Industry," and on Oct. 30, 2019, the Ministry of Finance released the country's "Medium Term Budget Policy Statement" (MTBPS). We view these statements, which were broadly in line with an expected measured approach to sector reform and government support, as providing some clarity on government policy in relation to 100% state-owned electricity utility ESKOM Holdings SOC Ltd.(Eskom; ###+/Stable/--; zaB/--/zaB) for the next three years. The announcements do not have an immediate impact on S&P Global Ratings' rating or outlook on Eskom. The MTBPS confirmed Eskom's government support package of South African rand (ZAR)69 billion over fiscal years (FY; in Eskom's case, ending March 31) 2020-2022, which it announced in August 2019. The budgets also included the ZAR23 billion per year announced in the...

Bulletin