Wed, 26 Jun 2019

It is "obvious" that load shedding will have a dampening effect on the SA economy, the full extent of which will only be known in time, Trade and Industry Minister Rob Davies has said.

The minister was speaking on government's role in SA's economic recovery at an event hosted by the Cape Town press Club on Tuesday.

Taking questions from journalists, Davies responded to concerns about the effect of the recent spate of load shedding on the economy, and investor sentiment.

"It is pretty obvious load shedding will have a dampening effect on the economy. It means production is not happening at the scale at which it was happening," he said.

SA needs to spend R1 trillion to grow power capacity by 2030 - Radebe

Davies recalled conversations with potential investors at the Investment Summit held in 2018. President Cyril Ramaphosa had launched an international investment drive to raise $100bn over five years.

At the time, Davies said investors indicated they would take a "long-term view" of SA. "When you invest, you make a bet that things will be sorted out and will improve over time as you are investing," he said.

We are not out of the woods, things could change at short notice - Eskom's Eztinger

There are serious issues of governance and technical capacity which must be addressed, he added.

The president's approach to restore technical capacity at the power utility, is the "only way" forward for Eskom, he argued.

Investors and ratings agencies want to see if SA is moving to put things right at Eskom, Davies said.

Smoke out corruptors

Commenting on state capture, and its relationship to Eskom, Davies said that no one intentionally wrecked the power utility. But individuals saw opportunities to "take a little bit" here and there.

Eventually it all accumulated to institutional damage of significant scale, he said.

Davies believes those implicated in corruption must be "smoked out".

Specifically, there must be consequences for those who improperly acquired tenders and other benefits.

More South Africa News

Access More

Sign up for South Africa News

a daily newsletter full of things to discuss over drinks.and the great thing is that it's on the house!