Registered users can save articles to their personal articles list. Login here or sign up here

Moody’s sees budget cuts as option for SA to absorb Eskom costs

Government considers departmental budget cuts.

South Africa is likely to absorb extra financial support for the struggling power utility Eskom with new revenue and expenditure measures in the next mid-year budget review, with departmental budget cuts as an option, ratings agency Moody’s said on Thursday.

“In any event, Moody’s sees the government’s room to manoeuvre as extremely constrained,” Moody’s said in a statement.

Read: SA to seek budget spending cuts as debt climbs

Eskom, which supplies more than 90% of the power in Africa’s most industrialised economy, is deep in crisis as its sales decline while debt-servicing costs soar, and is dependent on government bailouts.

It is regularly cited by ratings agencies as one of the main threats to South Africa’s creditworthiness and economic growth.

Get access to Moneyweb's financial intelligence and support quality journalism for only
R63/month or R630/year.
Sign up here, cancel at any time.

COMMENTS   3

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up for FREE

So services and capital-spend projects are cut – not salaries and perks of civil servants and politicians?

Moody’s seem to be slightly confused. They seem to care about cash flow and not the resolution of the problems at ESKOM.

Not cutting labour is a sure sign that the intention is just to pull the wool over their eye’s.

But they are so gullible that it might work.

Load All 3 Comments
End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
Insider GOLD
ONLY R63pm

Moneyweb's premium subscription is a membership service which will give you access to a number of tools to take charge of your investments.
Or choose a yearly subscription at R630pa - SAVE R126

Get instant access to all our tools and content. Monthly subscription can be suspended at any time.

Podcasts

SHOP NEWSLETTERS TRENDING CPD HUB

Follow us:

Search Articles:Advanced Search
Click a Company: