France wants to help bail out Eskom

The French government is interested in providing Eskom with financial support, according to a report in The Sunday Times.

French ambassador Aurelien Lechevallier told the Sunday Times that the country was already working on plans to provide the failing power utility with international support.

“With our French development agency, we are ready to provide some kind of financial support to assist with the restructuring of Eskom,” Lechevallier said.

International financial support for Eskom will most probably come from a multi-partner loan which includes other European nations and banks, the ambassador added.

“It will not be France alone, it could be France with maybe Germany, maybe with South African development banks, maybe the Brics bank,” he said.

Last year, France provided Eskom with a R1.5-billion loan for a renewable energy initiative, following previous funding which was provided to the South African power utility.

Eskom problems

Eskom faces serious financial challenges and is crippled by a R450-billion debt as well as poor productivity and corruption.

The government recently published a turnaround plan to rescue the state-owned power utility, but this was met with a lack of confidence by investors.

Stakeholders said the government sidestepped some of the biggest problems at Eskom, like its bloated workforce, and was not decisive enough in its turnaround plan.

Another problem is that Eskom’s turnaround plan is nothing new. In fact, the government has unveiled numerous similar plans over the last decade.

Despite this, the deterioration of the company continued, with an increase in corruption, debt, and mismanagement.

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France wants to help bail out Eskom