Lowering SoE risk to fiscus requires governance and business-model reform - S&P

The risk posed to government’s fiscal position as a result of contingent liabilities linked to South Africa’s State-owned enterprises (SoEs) will be only partly alleviated by governance reforms, S&P Global Ratings warns, arguing that greater attention will also have to be given to reforming SoE business models. Associate director Gardner Rusike says that, while S&P Global Ratings has noted recent efforts to address governance problems, particularly at SoEs with weak balance sheets, such as Eskom, the contingent-liability risk not only persisted, but also had increased.