The rand strengthened the most among emerging-market currencies on Friday as investors assessed President Cyril Ramaphosa’s pledges to overhaul South Africa’s electricity industry and curb government spending, Bloomberg News reported. While offering little that is new on the planned restructuring of Eskom Holdings SOC Ltd., Ramaphosa announced sweeping measures Thursday to address power shortages and reduce dependence on the debt-stricken utility.
An application by two trade unions to block job cuts at struggling state-owned airline South African Airways (SAA) was rejected by the country’s labour court on Friday. SAA is fighting for survival after being placed under a form of bankruptcy protection in December, Reuters reported. The unions argued that SAA’s administrators were planning far-reaching job cuts without holding the proper consultations required by the country’s labour law.
South African state airline SA Express is under a form of bankruptcy protection known as business rescue, a spokeswoman for the airline said on Thursday. Her comments come after SA Express lost a court battle with a contractor, logistics firm Ziegler, earlier this month, Reuters reported. SA Express, which flies to domestic and regional destinations, is a separate business from much larger state carrier South African Airways (SAA), which entered business rescue in December.
South African labor union Solidarity began a legal process to block plans to use the state pension fund to help debt-stricken power utility Eskom Holdings SOC Ltd, Bloomberg News reported. The action adds to opposition from other employee groups resisting a proposal by the Congress of South African Trade Unions, the nation’s biggest labor organization, to cut Eskom’s debt by 254 billion rand ($17.2 billion). Cosatu had expected to reach a pact with business on the idea before President Cyril Ramaphosa presents his state-of-the-nation address on Thursday, but has pushed back that timeline.
Zambia will cancel or downsize project loans worth about $5 billion as the nation tries to rein in runaway external debt that’s been increasing its risk of default, Bloomberg News reported. The government has about $7 billion in pipeline external debt -- loans contracted but not yet disbursed -- and plans to slash this to about $2 billion, Finance Minister Bwalya Ng’andu said on Wednesday.
Ghana is seeking to prosecute a former finance minister, industry regulator and deputy central bank governor in a bid to stamp out alleged collusion with company executives that helped contribute to the West African nation’s biggest banking crisis, Bloomberg News reported. The former officials are being charged along with nine other banking executives on charges ranging from money laundering to defrauding depositors in the aftermath of a three-year industry clean-up -- the costs of which could escalate to 20 billion cedis ($3.7 billion).
Squabbling between South Africa’s government and the state-owned airline’s bankruptcy administrator is threatening its chances of survival, Investec Ltd.’s chief executive officer said. President Cyril Ramaphosa in December placed debt-ridden South African Airways in business rescue, a local form of bankruptcy protection, Bloomberg News reported. Over the past few days, there’s been a flurry of conflicting messages from the government and the business-rescue practitioners, leaving investors and customers unclear about whether the carrier has a future.
Mozambique on Monday withdrew appeals against a South African court decision not to extradite its former finance minister, Manuel Chang, wanted in relation to a $2 billion debt scandal that plunged his country’s economy into crisis, Reuters reported. Chang, who denies wrongdoing, was arrested in South Africa in December at the request of the United States while Mozambique also requested his extradition, sparking a legal battle over where he should be sent.
A proposal by South Africa’s biggest labor-union federation to rescue debt-stricken Eskom Holdings SOC Ltd. with government workers’ pensions would amount to little more than a shifting of contingent liabilities, according to BNP Paribas South Africa, Bloomberg News reported. The Congress of South African Trade Unions’ proposal that state institutions including the Public Investment Corp.
Ghana plans to use as much as $1 billion of the Eurobonds it sold last week to help restructure the country’s obligations to independent power producers, said Finance Minister Ken Ofori-Atta. The West African country is in talks to re-negotiate supply deals with the power companies known as IPPs, Bloomberg News reported. The currently take-or-pay agreements mean the government is billed even for unused electricity. “We are going to put about $1 billion aside from the proceeds of the Eurobond to look at how we resolve those IPP issues,” Ofori-Atta said in a broadcast on Joy FM.