South Africa Burdened by Utility’s Near $35 Billion Debt Load
- Utility isn’t selling enough power to cover costs, interest
- Loans now account for more than half of Eskom’s total debt
A pylon tower carries electrical power lines over residential shacks, some equipped with solar power geysers on their roofs, in the Alexandra township outside Johannesburg, South Africa.
Photographer: Waldo Swiegers/BloombergThe embattled South African state power utility’s debt burden, described by Goldman Sachs Group Inc. as the biggest threat to the nation’s economy, has burgeoned, compounding the difficulty the government faces in formulating a turnaround plan.
Eskom Holdings SOC Ltd.’s debt is approaching 500 billion rand ($35 billion), according to data compiled by Bloomberg from public records, including bonds and issued loans, up from about 370 billion rand a year ago. While the utility declined to comment on the current number, its Chief Executive Officer Phakamani Hadebe last month put total debt at about 450 billion rand.