Mbeki gets energy supply report from Eskom

January 21, 2008,

Eskom has given President Thabo Mbeki a detailed assessment of the energy supply problem. Mbeki, together with Mineral and Energy Affairs Minister, Buyelwa Sonjica, met with Eskom management last night to discuss the electricity shortfall.

This follows a week of rolling black-outs across the country which have been attributed to a lack of capacity to deal with the growing energy demands. Fears that the ongoing Eskom blackouts could have of a long-term effect on the country's economy are growing.

Kagiso Securities economist Elize Kruger says should rolling blackouts continue, there is a danger that several capital expenditure projects in the country will be delayed. Kruger says this in turn could contribute towards negative sentiment among investors.

She also expects the power cuts to lead to lower productivity and lost income at a time when the economy is already slowing due to higher lending rates and high inflation.

Sabcnews.com