South Africa’s debt repayment liability cannot remain cloaked in secrecy and the details of an R33 billion loan agreement between Eskom and the China Development Bank needs to be made public, Democratic Alliance leader Mmusi Maimane said on Sunday.
Maimane said he had written to President Cyril Ramaphosa on August 24 requesting that he table the full R33 billion loan agreement that Eskom recently signed with the China Development Bank (CDB), with all its material terms and conditions (T&Cs), in the National Assembly within 14 days. The president had yet to do so.
He would, therefore, submit a request to Eskom in terms of the Promotion of Access to Information Act (PAIA) for the terms and conditions of this loan to be made public. This record needed to include the interest rates agreed to, repayment terms, guarantees, default terms, total amount payable, loan amount, total interest charged, and annual percentage rate.
“South Africa’s repayment liability cannot remain cloaked in secrecy. If the president is as confident about this loan as he is about the government’s economic stimulus package, he should have no problem with disclosing the T&Cs of the Eskom-CDB loan.”
In a public enterprises and energy joint portfolio committee meeting at parliament last week, Eskom chairman Jabu Mabuza committed to sharing a table of loans with the financial details, interest, and base rates to the committee, without the names of the lenders. It was already public knowledge that the CDB was the lender for Eskom’s R33 billion loan, so the PAIA application should be welcomed by the chairman, Maimane said.
“An Africa Confidential report published this week entitled ‘Bonds, Bills and ever bigger debts’ shows that ‘The [Zambian] state electricity company Zesco is already in talks about a takeover from a Chinese company… The long-term outcome could be effective Chinese ownership of the commanding heights of the economy and potentially biggest loss of national sovereignty since independence. China’s debt-trap diplomacy has already trapped the Zambian power utility and will no doubt be as ruthless on South Africa’s power utility if Eskom defaults on the R33 billion loan from the CDB.
“President Ramaphosa needs to step out of the ANC’s era of secrecy and publicise the T&Cs of this loan in the spirit of transparency and accountability,” Maimane said.