South Africa Cannot Afford Nuclear Electricity amidst Downgrades

The Federation of Unions of South Africa (FEDUSA) maintains that South Africa cannot afford nuclear electricity and the country should rather focus on achieving economic and political stability, now that Standards and Poor downgraded the local-currency debt score to junk status or sub-investment grade.  Moody’s placed the country on review for downgrade in February 2018, after the Minister of Finance has tabled the National Budget in Parliament said Dennis George FEDUSA General Secretary.

Fragile economic growth has seriously affected public finances, which will negatively impact on public sector wage negotiations in the Public Service Co-ordinating Bargaining Council representing public servants. The weak economic growth will leave millions of teachers; health workers, police officers and citizens further trapped in spiralling debt and worsened levels of poverty and unemployment. Furthermore, fuel prices are expected to show big increases in December 2018 due to the continued rise in the global crude oil price and the further weakening of the exchange rate. The Zuma faction has destabilised key policymaking institutions such as the South African Reserve Bank and the National Treasury added George.

The entire economic and political situation could have been avoided if it was not for the weak political leadership of President Zuma. The country should have pursued economic stability, discipline and prudent fiscal policy within the context SOCs regulatory reform as well as sound corporate governance leadership. Activities of government at all levels are affect every part with corruption and state capture, which has placed the entire economy at risks. The National Development Plan objective of creating 11 million jobs by 2030, while maintaining a yearly average growth rate of 5.4% every year is also in jeopardy.

FEDUSA will attend the NEDLAC Sovereign Downgrade Task Team meeting today to address the drivers on which the Ratings Agency based their decision to downgrade the country, to discuss options to mitigrate against the negative impacts of the downgrade particularly on the poor, working class and vulnerable sectors of society. FEDUSA is committed to work with business to stabilise the economy to provide solutions and to reverse the downward trend in ratings. Furthermore, FEDUSA believes in co-creating wealth and increasing prosperity for all our people by connecting the human capability and the social partnership in NEDLAC to deliver the achievement of higher inclusive economic growth, transformation and employment creation added George.

Global diversions away from nuclear to renewable energy sources (sun, water and wind) have been proven to be a lot cheaper and better for the environment. Public servants through the GEPF and PIC bought more than R100 billion of Eskom Bond.  Whilst FEDUSA welcomed the Parliamentary enquiry confirming the extent of state capture at Eskom to be even deeper and more worrying than previously imagined, the sheer lack of commitment by Government in aborting the nuclear programme will continue to motivate downgrade decisions by ratings agencies, said FEDUSA General Secretary, Dennis George.

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FEDUSA is the largest politically non-aligned trade union federation in South Africa and represents a diverse membership from a variety of sectors in industry.  See www.fedusa.org.za for more information.

 

For interviews:

Dennis George

FEDUSA General Secretary

084 805 1529