March 4, 2019 / 5:54 PM / 3 months ago

UPDATE 1-South Africa appoints experts to lead Eskom reform

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JOHANNESBURG, March 4 (Reuters) - South Africa has appointed 11 industry experts to investigate failures at power company Eskom’s ageing coal-fired stations and other breakdowns that have caused the worst electricity shortages in a decade, the government said on Monday.

Problems at Eskom include a 420 billion rand debt pile, massive corruption scandals, and the latest round of national electricity power outages have rattled investors’ confidence in President Cyril Ramaphosa’s vow to revive economic growth.

Ramaphosa has promised to split Eskom into three entities to make it more efficient but faces intense opposition from labour unions, and last month’s announcement of a 69 billion rand bailout for the firm has received lukewarm reaction from ratings firms.

On Friday, S&P Global Ratings upped Eskom’s outlook to stable from negative but warned the government bailout was not enough to cover the firm’s funding requirements, again exposing the threat Eskom poses to the sovereign rating which is one step from junk.

“The technical review team includes academic, engineering and power systems professionals and is required to conduct a rapid but intensive review of the operations, maintenance and the technical environment at Eskom power stations within four weeks of commencing their work,” Minister of Public Enterprises Pravin Gordhan said in a statement. (Reporting by Mfuneko Toyana Editing by David Goodman/David Evans)

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