The Economy Is Why South African Banks Need Quick Eskom Fix

The fingerprints of South Africa’s power utility are all over the economy’s demise. But fixing Eskom Holdings SOC Ltd. is giving President Cyril Ramaphosa a chance to switch course on issues from climate change to growth, Bloomberg News reported. “It’s really important to link Eskom’s restructuring to where we want to be as a country,” said Roger Jardine, the chairman of FirstRand Ltd., Africa’s largest bank by market value. “It has to happen as soon as possible.” The utility has lost its 10th chief executive officer in as many years, relies on bailouts to fund operations and interest payments, and, can’t keep aging coal plants running, contributing to the biggest economic contraction in a decade in the first quarter. Despite Eskom having too many workers, labor unions oppose Ramaphosa’s plan to split the company into three, while no visible progress has been made on reorganizing its liabilities. Read more