Energy specialist Lungile Mashele has warned that if South Africa’s ‘inadequate electricity generation situation’ does not improve, the prospects for economic growth in 2023 ‘will be dismal’.
According to Bloomberg, Mashele estimated that load-shedding had reduced the potential size of the South African economy by almost a fifth since it began around 2008.
She believed that ‘(outages) can be expected every week this year’.
Mashele, sector specialist for energy and infrastructure at the Public Investment Corporation, told a conference at the Gordon Institute of Business Science last week that had South Africa ‘focused on our problems in 2008 the situation [would] be a lot better today’.
Bloomberg reports that Eskom imposed rotational blackouts on more than 200 days in 2022 and almost every day this year, and that the South African Reserve Bank has estimated that the energy crisis will shave two percentage points off growth this year.
Mashele, whose organisation manages R2.55 trillion, said outages were affecting everything from the timing of surgeries and the slaughtering of chickens to mining production volumes.
She warned that marginal underground precious-metal mines may face closure, leading to lower export earnings and job losses.
Load-shedding had already led to sewage spills, and insurance claims due to the blackouts increased by 250% over the last year.
Bloomberg notes that the International Monetary Fund said last week it had reduced its economic growth forecast for South Africa for this year from 1.2% to 0.1%, largely because of the outages.
[Image: Oleg Gamulinskii from Pixabay]