JOHANNESBURG – South African state companies the Post Office and broadcaster South African Broadcasting Corporation (SABC) have requested billions of rand in financial support, the National Treasury said in a presentation to parliament on Tuesday.
The Treasury said the Post Office had requested 4.9 billion rand (US$292.87 million) in support and SABC was seeking 1.5 billion rand because of the impact of the COVID-19 pandemic.
It added that state agricultural lender Land Bank, which defaulted earlier this year, had resumed interest payments to lenders from August 11.
Reuters reports that the requested bailout amounts to almost R10 billion, while other state-owned companies have warned of closure if they do not get much-needed funding.
The amounts requested include:
The Post Office had requested R4.9 billion in support;
The South African Broadcasting Corporation (SABC) is seeking R1.5 billion;
Airports company ACSA had applied for an equity injection of R3.5 billion because of the impact of Covid-19;
Arms firm Denel faces the risk of entering bankruptcy protection or being liquidated;
Power utility Eskom’s financial performance was worse than budgeted for as a result of limited economic activity during the pandemic.
A presentation given by the Department of Public Enterprises at the end of August shows that losses at South Africa’s state-owned enterprises have continued to pile up in 2020.
Diamond mining company Alexkor reported a loss with no revenue-generating activities and the company’s cash reserves are expected to be depleted by September 2020.
Eskom doesn’t generate enough cash to meet its costs and is surviving on government bailouts. Its debt pile stands at R454 billion, of which R300 billion is guaranteed by the government
SAA was placed under business rescue in December 2019, due to declining performance and its inability to pay its debts.
SA Express was placed under business rescue in February this year and was subsequently placed under provisional liquidation on 29 April 2020 by the High Court. The provisional liquidators have advertised the expression of interest for the sale of the business.
- BUSINESSTECH/REUTERS.
