China is so wary of Eskom’s promises about the construction of Medupi and Kusile that it’s still withholding a R7 billion payment out of fear that the power utility might not continue with the construction of the projects
Rapport, City Press’ sister publication, previously reported that the Chinese Development Bank was meant to have transferred the money in March, and the fact it didn’t do so had led to a scramble to scrape together emergency funding for Eskom. At the eleventh hour, Absa granted Eskom a short-term loan of R3 billion.Adrian Lackay, spokesperson for Minister of Public Enterprises Pravin Gordhan, confirmed that senior department officials had flown to Beijing to consult CDB officials.
Jabu Mabuza, chairperson of Eskom,had since emphasised that the projects would continue after a full analysis of the costs and benefits. The Chinese position was important when one took into account conditions that might exist as part of the larger bundle of Chinese loans to Eskom – which could include a future interest as one potential example. Eskom’s status in a broader sense was therefore important to the Chinese, said Montalto.
Lackay said the CDB loan existed entirely independently of all the speculation. The loan was guaranteed by the government and was not backed by Eskom’s assets.
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