Debt-for-climate swap proposal conditional on Eskom shutting coal-fired plants
Deputy finance minister David Masondo. Picture: GALLO IMAGES/ZIYAAD DOUGLASDavid Masondo suggested that investors forgive about R146bn of sovereign debt in exchange for power utility Eskom meeting climate targets.
In order to transition from the use of coal to generate electricity to renewable energy Eskom will need to borrow about R400bn, equal to its current debt, and will need a “complementary transaction” to achieve that, he said in a speech on Tuesday. Under Masondo’s proposal, which he termed a debt-for-climate swap, a portion of national debt, which he suggested could be R146bn, would be forgiven by new or existing creditors. In exchange SA would pledge an equivalent amount as an equity injection into Eskom, conditional on it closing down coal-fired plants, and as guarantees for further borrowing, he said.
Some of the money could be used to cushion communities from the impact of the coal plant closures, he said. Masondo first raised the possibility of forgiveness to solve Eskom’s debt problem on July 30. He gave little detail at the time.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Eskom’s Kendall power plant catches fireAnother Eskom power plant has caught fire
Read more »
Eskom’s Kendal power plant catches fireAnother Eskom power plant has caught fire
Read more »
Eerste River residents refuse to host people who built shacks on railway linesResidents have started a petition to prevent the proposed move of Langa residents to their area
Read more »
WEBINAR | Climate choice or climate challenge?SPONSORED | Register for Critical Conversations by Sanlam Investments live at 10am on September 13.
Read more »
VIDEO | Mozambique corruption | Latest on Moz hidden debt trialThe Center for Democracy and Development Adriano Nuvunga spoke with eNCA's Dan Moyane.
Read more »