The continuing financial and operational issues at South African power utility Eskom pose the single biggest risk to the country's economy, according to the chief operating officer of mining company South32.
Eskom, which supplies South Africa's mining sector with electricity that is largely generated by burning coal, needs a business model which will retain key industrial customers that are already large domestic employers, while also supporting the country's competitiveness on a global stage, South32's Mike Fraser said."Eskom is the engine of South Africa's economic growth. A robust national power utility that is sustainable over the long term will benefit, and in particular our mining industry, which relies heavily on competitive [costs for] power," Fraser told the 25th Mining Indaba in Cape Town, South Africa."The price of electricity is a key factor in the ability of South Africa to compete for investment in industrial development," he added.South32 has its headquarters in Perth, Western Australia, and is a major supplier of coal to Eskom through its South Africa Energy Coal (SAEC) business. It also has a significant export position.SAEC is located in the...