Eskom took South Africa to the brink of collapse for 72 hours late in March

For three days from 26 March, Eskom nearly caused the economy of South Africa to collapse when it ran out of cash to meet its liabilities, wrote Daily Maverick’s Marianne Merten on Thursday.

Nobody seemed to notice, and those at the helm ensured it stayed that way.

Eskom got a stay of execution on 29 March with a R3 billion commercial loan from Absa – backed fully by Government.

If it wasn't for that emergency loan, Eskom probably would've become liable to immediately repay R281 billion of its R419 billion debt; thereby breaking fiscus.

To make matters worse; if the ailing utility defaults it could trigger the immediate demand for repayment of all government-guaranteed debt of the other state-owned companies.

Ray White (in for Bruce Whitfield on The Money Show) interviewed Merten.

Listen to the interview in the audio below (and scroll down for quotes from it).

We were literally there! It was gobsmacking… South Africa cannot afford for Eskom to default… it was close, it was very close…

Marianne Merten, Daily Maverick

It’s gobsmacking… the financial issues at Eskom are not new… it’s the most significant risk to South Africa…

Marianne Merten, Daily Maverick

It appears that Eskom… didn’t check whether the money was coming as anticipated by 26 March. That day arrived then, whoops! Panic!… How is it even possible that Eskom doesn’t know?...

Marianne Merten, Daily Maverick

We’ve had pushback from labour… I think there’s a lot of contested spaces within Eskom…

Marianne Merten, Daily Maverick

Our public finances are supporting Eskom… it does not anticipate generating sufficient cash… at any time over the next five years… our public finances will continue to be needed… That is a very serious situation…

Marianne Merten, Daily Maverick

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This article first appeared on 702 : Eskom took South Africa to the brink of collapse for 72 hours late in March


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