Moody’s says new Eskom support credit negative for SA

Rating agency Moody’s said the South African government’s proposal to provide additional financial support to struggling state-run power firm Eskom was “credit negative” for the sovereign as it was a further drain on fiscal resources.

Finance minister Tito Mboweni this week tabled an appropriation bill in parliament to give Eskom an extra R59 billion of government support.

Read: Sarb gives, finance minister takes

Moody’s, the last of the three big international ratings agencies to have South African debt at investment grade, said in an issuer comment published late on Wednesday that the government’s room for manoeuvre was “extremely constrained”. 

Source: moneyweb.co.za