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South Africa is considering declaring a national state of disaster as record power cuts cripple the economy.
The government is looking into whether the ongoing energy crisis fulfills the legal requirements for the measure, last put in place in March 2020 to manage the Covid-19 pandemic, President Cyril Ramaphosa said in closing remarks at the ruling African National Congress’s strategy meeting on Monday.
Read all our Eskom coverage here.
“Work is already underway within government to establish whether the legal requirements of a national state of disaster are met and what specific actions we would be empowered to undertake,” he said.
Past state of disasters have enabled the fast-tracking of spending and the implementation of certain regulations. In the case of the coronavirus outbreak, for example, it enabled lockdown rules to be enforced and medical supplies to be procured.
The ANC has come under increasing pressure to resolve South Africa’s electricity crisis after more than two decades of indecision, graft and political interference reduced state-owned utility Eskom Holdings SOC Ltd. to a dysfunctional entity reliant on government handouts. The country has suffered 94 consecutive days of rotational blackouts, known locally as loadshedding, often for 10 hours or more a day.
The power cuts are straining the finances of the nation’s biggest cities as the hit on economic growth reduces tax income and maintenance budgets surge because of breakdowns of electricity-distribution equipment.
The central bank cut its forecast for economic growth this year to 0.3%, from 1.1% previously, because of the power outages that it estimates will shave an estimated 2 percentage points off output this year.
“A national state of disaster will enable us to have the instruments necessary to fully implement the challenges that our nation faces,” Ramaphosa said.
© 2023 Bloomberg
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