Government and Eskom can now only be rescued by the private sector says expert

  • The Mining Indaba takes place in Cape Town from 6-9 February 2023.

  • Mining industry experts, leaders and investors gather at the event to discuss the latest within the sector.

  • The event takes place ahead of president Cyril Ramaphosa’s State of the Nation address on Thursday.

It’s a massive political week for South Africa, with President Cyril Ramaphosa set to deliver his annual State of
the Nation Address in Cape Town on Thursday.

At the same time, there’s growing talk of a possible cabinet reshuffle, which also includes deputy president
David Mabuza stepping down from that role.

Paul Mashatile is strongly rumoured to be preparing to take over from Mabuza.

Also happening in the Mother City this week is the African Mining Indaba, where those in the mining sector gather
to discuss industry issues.

There still seems to be plenty of pessimism around mining, despite commodity prices being solid at the moment.

Oil is reporting record profits, coal remains in big demand despite climate change, while gold costs over R1m a kilogram.

In South Africa, failing SOE’s like Eskom and Transnet is putting a damper on the positives.

Peter Leon, partner and Africa chair at Herbert Smith Freehills says from a South African perspective, there’s unfortunately a lot to be pessimistic about.

The elephant in the room that Gwede Mantashe tried to address…is the issue around Eskom. The fact that he made the statement that he did…that the electricity availibility factor is now at 49% is a pretty horific figure.

Peter Leon, partner and Africa Chair at Herbert Smith Freehills

One silver lining that I see, is that this is going to lead to privatisation, because effectively with Eskom, you’ve got renewable energy coming on stream, albeit very slowly.

Peter Leon, partner and Africa Chair at Herbert Smith Freehills

The private sector is going to come in, simply because the state can’t manage these things anymore.

Peter Leon, partner and Africa Chair at Herbert Smith Freehills

Listen to the audio for more.

Author: editor

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