Eskom assured of access to funding
Treasury was looking to extend the R350 billion Guarantee Framework Agreement (GFA), which expires in March, because the completion of Eskom’s major projects – such as the Kusile and Medupi power stations – had taken longer than expected, Fuzile said.
“The programme is going to take longer, so it is now necessary to extend [the guarantees],” he added.
“All the debt raised via the guarantees will remain guaranteed for the full term.
“We may ask Eskom a few questions, but they would never be of a nature that the guarantees won’t be extended. [The length of the extension] is going to depend on many things, including how long the build programme is going to take.”
Earlier this month, ratings agency Fitch downgraded Eskom’s credit rating, stating: “If the GFA is not granted, this would introduce uncertainty to the borrowing plan and Eskom could face a funding crisis, considering its capital expenditure plans.”