THE SMART NEWS SOURCE | Feb 10 2010 01:52 | LAST UPDATED Feb 10 2010 01:52 |
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Political meddling in resolving a power struggle at Eskom has raised questions about South Africa's ability to run state-owned firms and could backfire with investors hesitant to commit new funds. Eskom chairperson Bobby Godsell resigned on Monday after he said the government failed to support the board's bid to oust the company's CEO, Jacob Maroga, after the two clashed over issues of how to run Eskom, the state-owned firm that is struggling to keep South Africa's lights on. But rather than resolving the dispute within the board, Eskom and the government have left it to unions, the opposition and interest groups to dominate the debate in the public sphere. Alistair Sparks, a political analyst at Standard Bank Securities, said the lack of government backing for the board will have serious implications for when Eskom needs to raise funds for its R385-billion expansion programme. "Serious institutions will be much more reluctant to lend money to Eskom and if they do, it will be at a much higher interest rate because the risk seems to be higher," he said. Eskom's leadership crisis is the latest in a series of disputes at South Africa's state-owned enterprises, raising doubts about the ability of President Jacob Zuma and Public Enterprises Minister Barbara Hogan to provide leadership. "Government intervention may be the prime cause of current chaos in the company," investment bank Fairfax said in a research note, adding that Eskom's ability to supply South Africa's key mining industry could be jeopardised as a result. Key roles at logistics group Transnet and South African Airways (SAA), which along with Eskom fall under Hogan's jurisdiction, have been left unfilled as the companies struggle to resolve internal battles. The crisis could further strain the patience of investors already worried that Zuma's allies may be pressuring him to change policies to the left. No leadership The African National Congress's militant youth league and the Black Management Forum asked for Godsell to quit, saying he drove a racist agenda against Eskom's black chief executive. Meanwhile, the government remained silent, with Zuma vowing to stay away from leadership disputes at state-owned firms. Hogan said last week that she was trying to resolve a breakdown in relations between the board and Maroga. "The Eskom issue is receiving urgent attention from the minister, and we are confident it will be resolved soon so that Eskom can refocus on its primary mandate -- that of ensuring security of electricity supply for the country," the minister's spokesperson, Ayanda Shezi, said. Analysts said Zuma was confronted with too many opposing views within the ANC and chose to do nothing to remain neutral. "He's not calling elements of his party that are misbehaving to order and is not allowing people that have been put into positions of responsibility to do their job," Sparks said. Economists said the dispute could have serious repercussions on the utility and other state-owned enterprises as investors might be less willing to send money their way if they sense political manoeuvring, or might ask to lend at much higher rates. Both Transnet and Eskom are struggling to raise all the funds they need to pay for their vast expansion programmes needed to feed fast-rising demand, especially as credit markets tightened on the back of the recession. Konrad Reuss, Standard & Poor's managing director for South Africa and sub-Saharan Africa, said that while the ratings agency did not expect the dispute to have an impact on the government's willingness to underwrite Eskom's guarantees, it was an unnecessary distraction nevertheless. "We have an economy that is slowly moving out of a recession, we have key government-owned firms that are important for the future economic development of the country ... this kind of leadership debate is an unnecessary distraction," he said. TOPICS IN THIS ARTICLE
Comments
Yep, Eskom was not going to get much investment in the first place, this has just solidified it a little more. Pity the whole govenmental structure didn't follow their leader, seems that it is completely clear now that Zuma is no longer President, all bow to president Julius the wanker.
white trash on November 10, 2009, 4:54 pm
My word, what a cheap politicking economists in Alistar Sparks, whys is it that I am not suprised with his kindergarden methods of analysing issues. President Zuma intervenes were there are issues that are beyond ministers and so far there is nothing untoward except that Board and Minister must get to a common understanding. We were told before Polokwane by Mr sparks that investors will runaway and again before elections that if Zuma is elected to the highest office simillar reactionary investors will be afraid and run away....I don't understand what's wrong with this economists who failed to warn us against recession! slumebr land is a very comfartable bed and I suspecet Mr Sparks is on it!
lenate mogale on November 10, 2009, 4:55 pm
Why there is no accountability and no one can do anything about it:
http://www.richmarksentinel.co.za/rs_articles_contributors.asp?conid=5&recid=554&pcurr=1
Paul Whelan on November 10, 2009, 5:37 pm
Typical boaremag mentality always jumping at our president for this things, its sad that we blacks always have to work 100 times more to prove to the whites that we good in our work.
martin soqaga on November 10, 2009, 5:54 pm
Lenate you are an idiot. You expect to look out of the window and see white men with bulging pockets running away with little puffs of dust emanating from their feet. This is because your empty head thinks that the world is a comic book. When investors get scared they don't "run away" you fool! They charge higher rates, they invest less and they sell our currency. They also choose to invest in places where the people are not as stupid and ignorant as you. Like China or India. But this is all too complicated for you to understand, lying in the sun looking after the cattle. One thing is certain, investors are not breaking down the doors to get into South Africa are they? You idiot. They ARE running away! VUKA! VUKA! wena lala phantsi
Pearson B on November 10, 2009, 5:55 pm
@Lenate. If I remember right Alistair Sparks was regarded as a ANC crony when he critisised the previous government - he was also seen as a traitor. I take my hat off for somebody who stands by his principals and believes - then and now. In the old days, and before coming to terms with the negative aspects of segregation, I also believe he was a "communist".
Lenate, Mr Zuma does not intervene - he solely rely on his advisors, whom may have their own agendas. What (black) people do not understand is that 95% of whites do not have a problem with a black government - what they have a problem with is the way this country has been governed the past 15 years. Officials not listening to advise - reinventing the wheel. I mean, if one does not agree with the derelict state our country is in, you must be blind. A few days ago the Outcome Based Education was scraped - a system the ANC introduced and which has failed dismally - and who are the "victims"- our children the future generation. Teacher colleges (from the apartheid-era) were closed. Blade Inzimande is bringing them back. There is honestly not one government department or parastatal that is not in a state of total collapse. The government has been warned about our water crisis looming. The official from the CSIR sidelined and suspended from delivering his speech. You mark my words: the water crisis is going to be worse than the electricity crisis.
Andre Scheepers on November 10, 2009, 6:13 pm
Gotsel was trying to promote DA at eskom. How come the first political that knew about Maroga's resign from eskom was DA. Gotsel voted for DA. He must go hang
sechaba Motloung on November 10, 2009, 6:48 pm
Never again shall this well governed country be controlled by the racists
Kobus Botha on November 10, 2009, 7:00 pm
Eskom board has failed the public, not long ago they gave Maroga a huge bonus and an increase, but in two months time they are claim to have no confidence to the same individual. That doesn't sound right. Godsell must go.
Kobus Botha on November 10, 2009, 7:19 pm
Ag ou Kobus - gaan piepie en gaan slaap. Jou bydrae is vervelig en al jou pogings om reaksie uit te lok is pateties.
Free Translation: Old Kobus, go and have a wee, and off to bed you go - all your postings are boring and your efforts to create reaction, are boring. Kobus - ek het gesê - gaan p*s en gaan slaap !!
Andre Scheepers on November 10, 2009, 7:39 pm
sechaba Motloung: The cow jumped over the moon ! Did you see it - watch closely. I know you have just arrived here from outer space - please check your facts before vomitting on this forum.
Andre Scheepers on November 10, 2009, 7:45 pm
Did anyone read the respective visions for ESKOM from Messrs Godsell and Maroga? Godsell lists 41 areas where ESKOM management still needs to work. Maroga talks vaguely of "a new leadership paradigm". Frankly, I don't think potential buyers of ESKOM debt are going to be impressed by management gobbldegook when coupled with recent performance
Roger Pacey on November 10, 2009, 7:49 pm
The only one who makes sense here is "poking nose"! I'm going for a piss and off to bed & maybe a poke...
Klipinnie Bos on November 10, 2009, 7:55 pm
@Paul Whelan - "The problem is political: a fundamental democratic deficit" - too true. Unfortunately many supporters of this so-called Government do not understand this strange Greek concept called democracy or anything remotely like it despite howls to the contrary. The parallels with the rest of Africa are there for all to see it is just a matter of time - see Martin Meredith. The only thing is that this time there is no excuse.
Joseph Savon on November 10, 2009, 8:00 pm
sechaba Motloung: 'Gotsel voted for DA. He must go hang' - Stop being counter revolutionary man.
Sinudeity @gmail.com on November 10, 2009, 8:31 pm
@ Kobus Botha
"Never again shall this well governed country be controlled by the racists" So, are you actually saying that Julius Malema and his buddies are leaving the show?
Reinhard Hiller on November 10, 2009, 8:48 pm
Whom are we doing a favour by expanding ESKOM's power generation capacity? certainly not the environment or future generations.
Wiser people around the world are persuing clean and renewable energy sources. We in South Africa on the other hand are fighting tooth and nail for our "right' to deplete our natural resources with impunity. Perhaps Maroga is doing us a favour with his rolling blackouts. This will probably emcourage us to harness the power of the sun, wind and water (hydro) more. I have installed a solar geyser. Benefit: Lower electricity bill. If everyone in the country could do the same, this debate wont need to take place. So, stop fighting for your "right" to polute with greenhouse gasses and go green instead !!
Victor Mathebula on November 10, 2009, 9:03 pm
I see that Sechaba-is-not-a-fake-Communist has a different moniker than the one he uses with The Times.
Still a complete moron though and his grammar is still atrocious. This guy along with his mate "Kobus Botha" bring absolutely nothing to these debates. As soon as you see there names just skip to the next comment because nothing they write is worth reading.
Joe Irwin on November 10, 2009, 10:00 pm
Eskom. Another good example of how the ANC's leadership has nothing to do with solving problems, but rather peppering it with political manoeuvring. And as poverty and joblessness increases the rest of the tax payers gets choked to death because eventually alternative measures needs to be taken to sustain this crumbling parastatal,like plenty other dysfunctional parastatals.
Well, lets clap hands to 15 years of African democracy. Good luck to me and all others who are being choked, and those enlightened enough to realize they are being choked. It's a matter of how long can you hold out.
Jakes Observing on November 10, 2009, 11:41 pm
Our presidency has been outsourced - this is what happens when you have a clueless and spineless leader. It's a shame - Zuma is a real useless leader.
Richard Bunu on November 10, 2009, 11:56 pm
All Zuma wanted was Big Man in Africa power. Now he has it, he's completely clueless as to what to do. Things Fall Apart.
JLG on November 11, 2009, 12:08 am
Let's make sure we understand this. In the apartheid system, jobs were not awarded to the person with the best skills. The checklist went like this:
light skin colour? Check. speaks Afrikaans? Check. member of Broederbond? Check. This system "worked" because a society catering for the needs of a small privileged elite can afford a lot of inefficiency. Unfortunately this system has not been fundamentally reformed. The checklist has changed. It now looks something like this (A checklist first): light skin colour? Check. speaks Afrikaans? Check. member of Broederbond? Check. That gets you "consultants" who allegedly know what they are doing. Next, to get token appointees who won't question the "consultants" we have the new "transformed" B check list: dark skin colour? Check. ANC connections? Check. not qualified? Check. This is less about race than the beneficiaries of the old system maintaining influence by keeping competents away from senior appointment. The competents being denied opportunity in many cases are black. I've seen this myself when I had a short stint as a consultant in a government department (despite not matching the A checklist). Where racism does kick in is the implicit assumption that all black people are incompetent, reinforced by the deliberate tactic of ensuring that senior appointments ARE NOT MADE ON MERIT. Unfortunately many on the ANC side are reinforcing this perception by backing incompetents because of their party connections. If we were to make senior appointments purely on merit with allowance for boosting disadvantaged candidates, we would see real transformation. Many highly skilled black people are pushed to the sidelines because of this game.
Philip Machanick on November 11, 2009, 12:47 am
Mr Machanick explains that the Broederbond is still running Eskom, only this time via BB consultants such as Ms Susan Olsen. The BB have also successfully kept Mr Machanick himself from further consulting to government.
The other thing the BB has been spectacularly successful at (with the help of many but note, not all, in the ANC) is stocking the top positions with incompetent blacks. This is a strategy which then allows them to manipulate everything behind the scenes. In the case of Eskom the chief manipulator is probably Ian McCrae who, even though his Afrikaans is on a par with that of Susan Olsen, secretly rose to a high position in the BB. You guys think he retired? Think again! Further examples of Broederbond influence are ASA refusing to step down in the face of SASCOC instructions, and the two different factions claiming leadership of NAFCOC fighting to occupy the office space. This is pure BB racism, kicking in, as it were. Thanks to Mr Machanick it is all clear to us now.
Jonathan Haze on November 11, 2009, 6:14 am
this kobus botha blogger thinks that the country is well governed.
OK, please tell us one good thing that the anc has done.
cynical on November 11, 2009, 8:26 am
Mechanic:
Thanks for clearing eveything up! So it's all the Broederbond's fault after all! Funny how the "checklist" didn't apply to you - what's your secret!?!
Skhokho 2010 on November 11, 2009, 8:33 am
Skhokho: this was one of many attempts at making a contribution, most of which went nowhere. I don't need this sort of work, so I don't care if I don't get it but seeing highly paid consultants getting away with robbing the taxpayer when there is no money for basic services is not pretty.
I'm not saying this exact scenario applied at Eskom because I've never been there but it happens a lot in government. If we want to see real transformation, we have to stop treating the relics of the old system as if they represent some sort of perfection. They don't. They represent exactly what we were trying to get rid of.
Philip Machanick on November 11, 2009, 8:52 am
so white afrikaans-speaking people are the only relics of the old system? i take it you were one of the millions who didn't vote for the NP...what a joke!
stick your contribution mate - you sound like juju and his merry band of muppets.
Skhokho 2010 on November 11, 2009, 9:45 am
jlg, you are starting to sound like Moloko, been irrelavant at all times, if you have nothing to write, check the Orania website maybe you will find something interesting there,
Africa 4 Africans on November 11, 2009, 9:53 am
Tell this to juju malema & see if he cares or at least understand.Shame izwe lethu(our country) pity we still see everything in black & white.
Cigar & Cognac comrade on November 11, 2009, 11:44 am
does juju have internet in sandton?
Skhokho 2010 on November 11, 2009, 12:02 pm
Well, seeing as all these comments really have nothing to do with the article and the problem - I will put in my 10cents worth.
Whoever believes that Jacob Zuma is president is completely insane! He is there in name only, put in place by his buddies because he will be ineffective! Sure he listens to his advisors and of course he does nothing, takes no decisions etc. Not allowed to, even if he came up with a good idea. He is a man of the people, did terror training camps, dances at age 60 - undignified for a man in his position, commits adultry against no less than 3 wives - misses his machine gun and quote "has soft hands - not a working man". So he is just a token and will be removed when seen to be no longer useful. Malema is another story - he is the leader of the ANC - no one slaps him down or teaches him any manners or for that matter teaches him anything at all. He must be the most ignorant man in the country. Course, against Zuma's [took a shower to make sure I don't get aids] or my personal best [didn't know there were poor white people in SA] - I am sure there will be more from where that came from. In the meantime - the country sinks further into chaos - Viva the ANC
sue topham on November 11, 2009, 12:25 pm
This is Cloud Cuckoo Land for sure. I believe we have a big soccer tornament coming up. An international one. In 2010.
And, looking at my watch, I notice that 2010 is but two months away. South Africa is most certainly going to provide an illuminating display to the watching world. It makes one cringe to think about the forthcoming cock-up.
Citizen Mntu on November 11, 2009, 9:45 pm
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