Flash Briefing: Outcry against ban on guns for self-defence; Eskom slashes debt; McKinsey repays R870m for corruption

Written on 05/25/2021
Jackie Cameron

State-owned power utility Eskom reduced its debt by almost a fifth after repaying matured loans and benefiting from a more favourable exchange rate.

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  • Eskom, the beleaguered South African state power utility, reduced its debt by almost a fifth after repaying matured loans and benefiting from a more favourable exchange rate, Public Enterprises Minister Pravin Gordhan said. Debt fell to R401bn ($29bn) at the end of March, from R484bn a year earlier, Gordhan said in a webcast speech to lawmakers on Tuesday. The utility has yet to release its financial results for the year, says Bloomberg.
  • Professional services firm McKinsey, which played a central role in state capture and corruption in the Jacob Zuma era, says it has repaid R870m to parastatal Transnet. The figure includes fees paid to McKinsey in respect of the projects undertaken with Regiments Capital, plus interest.
  • The South African Reserve Bank is studying the benefits of issuing a digital currency for general retail purposes in line with several other central banks, it said on Tuesday. A central bank digital currency, or CBDC, is a form of electronic cash linked to the sovereign currency on a one-to-one basis, with its value protected by the central banks’ monetary policy and inflation-targeting regime. It would allow businesses and individuals to make electronic payments directly backed by the federal bank.
  • The DA has launched a petition against the Firearms Control Amendment Bill which proposes a ban on firearm ownership for self-defence by civilians. It said: “We must protect gun ownership for self-defence as it is the last line of defence for millions of South Africans. South Africa has one of the highest murder rates in the world. Just by walking in the streets, South Africans are exposed to dangers similar to those faced by people in some war-torn countries. Disarming law-abiding citizens in the current crime-ridden environment is reckless, ill-advised and places many innocent civilians at the mercy of criminals.”
  • Absa, Investec and the Development Bank of Southern Africa indicated they could support a bid by a Turkish company to supply emergency power to South Africa, according to a person familiar with the situation. Conditional backing from the financial institutions, which has yet to be finalised and is dependent on undisclosed conditions being met, enabled Karpowership to offer to supply 1,220 megawatts of power from ship-based, gas-fired plants. The person spoke on condition of anonymity because the banks haven’t publicly disclosed their involvement, reports Bloomberg. “The inclusion of Karpowership, a unit of the Karadeniz Energy Group, on the list of preferred suppliers has attracted criticism because it would lock the country into the use of a fossil fuel for two decades and was exempt from a requirement that would have boosted local manufacturing. South African banks are under pressure from their investors to cut funding to projects that could boost global warming.” Karpowership’s contract has been further imperilled by a legal challenge from DNG Energy that may be heard in mid-July at the earliest.