Tito Mboweni: Investors flagged Eskom as major concern at WEF

Finance Minister, Tito Mboweni has revealed that while the trip to Davos, Switzerland was successful, investors at the World Economic Forum (WEF) did raise serious concerns about the state of Eskom.

WEF investors have doubts about South Africa

Mboweni, who led the special envoy in the absence of President Cyril Ramaphosa, stated at a media briefing, that the trip yielded many positives. He indicated that the general feedback from engagements with WEF delegates was that there still is a great deal of interest in South Africa as an investment destination.

However, concerns were raised about the instability of Eskom, as well as fiscal sustainability. Recent developments at Megawatt Park have placed doubt on the government’s ability to contain the power grid and for investors, that is bad for business.

The departure of former Eskom Board Chairperson, Jabu Mabuza and his link to a shoddy multibillion-rand boiler deal with the power utility has had a negative impact on the outing.

The recent load shedding scare, one that President Ramaphosa had claimed was never going to happen, also left a bitter taste in investors’ mouths. However, for Mbowen the trip to Davos was less about inking deals and more about cleansing the country’s image.

“We had fruitful discussions, but if you think you are coming to Davos to sign deals, you are at the wrong place. You are here to build long term relationships, share your countries vision and listen carefully to the concerns of those investors that show an appetite to invest in your country.

“We tried our best to put our best foot forward, and I am convinced that we succeeded in addressing some concerns, such as South Africa’s ability to provide power,” Mboweni said.

The minister also confirmed that assertions were made to investors about the government’s commitment to ensuring fiscal sustainability and unnecessary expenditure. He also told the media that “the train is moving” on reforms aimed at boosting economic growth.

Eskom update: Load shedding forecast for the weekend

The power utility has not instituted rotational blackouts this week. In a statement released on Friday, Eskom noted that “while the power system remains constrained, no load shedding is expected.”

“Eskom has enough capacity to meet the demand for electricity. In addition, the emergency reserves, which are diesel and water at our open cycle gas turbines and pumped storage schemes respectively, were replenished to adequate levels overnight and will be utilised to supplement capacity, should the need arise,” the utility revealed.

#POWERALERT 1
Date: 24 January 2020

No loadshedding expected today pic.twitter.com/PNvKFCMjLW

— Eskom Hld SOC Ltd (@Eskom_SA) January 24, 2020