{"id":64442,"date":"2019-07-26T13:45:59","date_gmt":"2019-07-26T13:45:59","guid":{"rendered":"https:\/\/dynasty.co.za\/?p=64442"},"modified":"2021-06-22T17:26:10","modified_gmt":"2021-06-22T17:26:10","slug":"news-flash-eskom-sa-hot-water","status":"publish","type":"post","link":"https:\/\/www.dynasty.co.za\/staging\/news-flash-eskom-sa-hot-water\/","title":{"rendered":"News Flash &#8211; Eskom placing South Africa in hot water"},"content":{"rendered":"<p>Several months ago, we wrote about Dynasty\u2019s concerns surrounding Eskom, referring to it as the \u201cthe elephant in the room.\u201d These views have come further to fruition as Eskom\u2019s gargantuan weight on South Africa\u2019s fiscal health is all the more evident. \u00a0This week Moody\u2019s issued a warning that additional bailouts to support Eskom are \u201ccredit negative\u201d.<\/p>\n<h3><strong>Global News <\/strong><\/h3>\n<ul>\n<li>Boris Johnson has become Prime Minister of the UK. He has promised to, amongst other things,\u00a0<a href=\"https:\/\/news.vice.com\/en_us\/article\/59779x\/boris-johnson-helped-create-the-brexit-mess-now-its-his-job-to-clean-it-up\">deliver Brexit<\/a>\u00a0by the end of October this year. Regardless of what you may think of him, it will be an\u00a0<a href=\"https:\/\/www.dailymaverick.co.za\/article\/2019-07-25-boris-johnson-joins-donald-trump-completing-an-atlantic-right-wing-axis\/?utm_medium=email&amp;utm_campaign=First%20Thing%20Thursday%2025%20July%202019%20Mi-Plan&amp;utm_content=First%20Thing%20Thursday%2025%20July%202019%20Mi-Plan+CID_d19ac5a7fb3fde934d35e915062a0249&amp;utm_source=TouchBasePro&amp;utm_term=Boris%20vows%20for%20Brexit%20over-easy%20or%20Brexit%20hard-boiled\">interesting ride<\/a>.<\/li>\n<li><a href=\"https:\/\/www.dailymaverick.co.za\/article\/2019-07-24-robert-mueller-in-testimony-to-congress-resists-democrats-push\/?utm_medium=email&amp;utm_campaign=First%20Thing%20Thursday%2025%20July%202019%20Mi-Plan&amp;utm_content=First%20Thing%20Thursday%2025%20July%202019%20Mi-Plan+CID_d19ac5a7fb3fde934d35e915062a0249&amp;utm_source=TouchBasePro&amp;utm_term=Mueller%20keeps%20an%20even%20keel\">Robert Mueller<\/a>\u00a0delivered his anticipated testimony to Congress this week. Restrained as ever, Mueller confirmed that: Russia meddled and continues to meddle in US politics; and President Trump, while not charged, could face indictment once he leaves the White House. For a summary of what Mueller said in his testimony,\u00a0<a href=\"https:\/\/news.vice.com\/en_us\/article\/ywyynj\/a-real-time-mueller-reader\">follow this link<\/a>.<\/li>\n<li>Major global markets were up slightly this week, with the S&amp;P gaining 0.9% and the MSCI 0.5%, both to Thursday\u2019s close. Friday&#8217;s markets are currently also in the green.<\/li>\n<\/ul>\n<h3><strong>Local News <\/strong><\/h3>\n<ul>\n<li>Moody\u2019s rating agency, the only major rating company that still holds South Africa at investment grade, released a statement on Thursday saying that the additional R59bn in support to Eskom is\u00a0<a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2019-07-25\/moody-s-says-south-africa-s-eskom-bailout-plan-credit-negative\">credit negative for South Africa<\/a>\u00a0\u201cbecause it would be an additional drain on fiscal resources.\u201d<\/li>\n<li>The\u00a0<a href=\"https:\/\/m.fin24.com\/Markets\/Currencies\/rand-slides-as-moodys-warns-of-eskom-rescue-risks-20190725\">rand reacted on the news<\/a>\u00a0breaking above R14 to the US dollar to close 1.5% weaker. The rand has further weakened on Friday to be at\u00a0R14.25\/$ at the time of writing.<\/li>\n<li>Next week, Eskom is due to record an\u00a0R25 billion\u00a0financial loss.\u00a0This is\u00a0higher than any\u00a0single public or private company ever reported\u00a0in South Africa. The\u00a0loss is mostly attributable to higher labour costs,\u00a0<a href=\"https:\/\/www.dailymaverick.co.za\/article\/2019-07-25-eskom-set-to-post-stratospheric-loss-as-labour-costs-rocket\/\">follow this link for an article from Sikonathi Mantshantsha.<\/a><\/li>\n<li>To say that the public protector\u2019s reputation was held to question this week would be an understatement. The Constitutional Court upheld the High Court\u2019s ruling in the <a href=\"https:\/\/www.fin24.com\/Economy\/mkhwebane-could-pay-hundreds-of-thousands-of-rands-after-damning-concourt-judgment-20190722\">Absa-Bankorp matter<\/a>. The Majority ruling said that \u201cthe public protector&#8217;s entire model of investigation was flawed and that she was not honest about her engagements during the investigation.\u201d In so doing, they upheld the cost order award of the High Court that requires her to\u00a0<a href=\"https:\/\/www.dailymaverick.co.za\/article\/2019-07-22-mkhwebane-loses-sarb-appeal-concourt-orders-her-to-pay-15-out-of-her-own-pocket\/?utm_medium=email&amp;utm_campaign=Afternoon%20Thing%20Monday%2022%20July%20June%202019%20Exclusive%20Books&amp;utm_content=Afternoon%20Thing%20Monday%2022%20July%20June%202019%20Exclusive%20Books+CID_200e63fb3286277bfb4f57fd4fb6a08d&amp;utm_source=TouchBasePro&amp;utm_term=Monday%20blues%20for%20Public%20Protector\">personally pay back 15%<\/a>\u00a0of the South African Reserve Bank\u2019s legal costs.<\/li>\n<li>ANC Secretary-General, Ace Magashule, has been implicated in the #GuptaLeaks scandal. The Daily Mavericks investigation links new dots in one of South Africa&#8217;s most sordid corruption sagas,\u00a0<a href=\"https:\/\/www.dailymaverick.co.za\/article\/2019-07-23-cash-cows-and-computers-ace-magashules-laptop-deals-with-guptas-vrede-dairy-man-joemat-petterssons-saxonwold-meetings\/?utm_medium=email&amp;utm_campaign=First%20Thing%20Wednesday%2024%20July%202019%20Mi-Plan&amp;utm_content=First%20Thing%20Wednesday%2024%20July%202019%20Mi-Plan+CID_1383c69f30c889792b932f80f60f11c3&amp;utm_source=TouchBasePro&amp;utm_term=Cash%20cows%20and%20computers%20%20Ace%20Magashules%20laptop%20deals%20with%20Guptas%20Vrede%20dairy%20man%20Joemat-Petterssons%20Saxonwold%20meetings\">follow this link for more<\/a>.<\/li>\n<li>The ALSI was under pressure this week, falling 1.1% at the time of writing, despite the rand losing 2.3% to R14.25\/$ on the back of the Moody\u2019s warning.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><em>Source: Dynasty, Daily Maverick, Moneyweb, Reuters, RMB, Aljazeera, and Bloomberg Markets, etc<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Several months ago, we wrote about Dynasty\u2019s concerns surrounding Eskom, referring to it as the \u201cthe elephant in the room.\u201d These views have come further to fruition as Eskom\u2019s gargantuan weight on South Africa\u2019s fiscal health is all the more evident. \u00a0This week Moody\u2019s issued a warning that additional bailouts to support Eskom are \u201ccredit&hellip;<\/p>\n","protected":false},"author":2,"featured_media":64446,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[206,129,24,128],"class_list":["post-64442","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-newsflash","tag-boris-johnson","tag-eskom","tag-public-protector","tag-robert-mueller","category-3","description-off"],"_links":{"self":[{"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/posts\/64442","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/comments?post=64442"}],"version-history":[{"count":0,"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/posts\/64442\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/media\/64446"}],"wp:attachment":[{"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/media?parent=64442"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/categories?post=64442"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.dynasty.co.za\/staging\/wp-json\/wp\/v2\/tags?post=64442"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}