{"id":94446,"date":"2025-12-18T16:00:23","date_gmt":"2025-12-18T16:00:23","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion"},"modified":"2025-12-18T16:05:22","modified_gmt":"2025-12-18T16:05:22","slug":"south-africas-government-on-the-hook-for-r700-billion","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion","title":{"rendered":"South Africa\u2019s government on the hook for R700 billion"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>South Africa\u2019s government guarantees to state-owned enterprises (SOEs) have gone from R64.5 billion in 2008 to R707.8 billion in less than two decades.<\/p>\n

The biggest contributors to this debt are Eskom, Renewable Independent Power Producers, Transnet, the Trans Caledon Tunnel Authority (TCTA), and Sanral.<\/p>\n

Over the past few years, the National Treasury, led by Finance Minister Enoch Godongwana, has been attempting to reduce bailouts to SOEs, taking a \u201ctough love\u201d stance towards enterprises in financial turmoil.<\/p>\n

In response to a recent Parliamentary question from DA MP Mark Burke, Godongwana outlined the growth in government guarantees to SOEs from 2008 to 2025.<\/p>\n

Burke had asked the minister what he had found to be the contributing factors that caused the proportion of government debt guarantees to stand at almost 10% of GDP, as compared to 2% at the end of 2008.<\/p>\n

In response, Godongwana explained that, in 2008, government guarantees to SOEs amounted to R64.5 billion.<\/p>\n

At the time, the Trans Caledon Tunnel Authority (TCTA) was responsible for the highest amount at R19.3 billion in guaranteed debt.<\/p>\n

Over the past decade, Eskom\u2019s financial struggles have also weighed heavily on the government\u2019s balance sheet.<\/p>\n

The power utility has received a total of R350 billion in guarantees, of which R353.7 billion had been utilised by 30 June 2025. This includes accrued interest and revaluation of inflation-linked debt.<\/p>\n

In 2012, the Renewable Energy Independent Power Producer Program was also launched, and by 30 June 2025, the guarantee exposure under the program had amounted to R257.2 billion.<\/p>\n

Another large contributor to the rise in government guarantees to SOEs was Transnet, which has experienced severe financial struggles over the past decade.<\/p>\n

In June 2008, Transnet\u2019s guaranteed debt amounted to R14.7 billion, and by June 2025, the amount had increased to R48.4 billion.<\/p>\n

\u201cThe biggest contributors would therefore be Eskom, Renewable Independent Power Producers, Transnet, TCTA, and Sanral,\u201d Godongwana said.<\/p>\n

Tough love<\/b><\/p>\n

Government guarantees to SOEs fall under the state\u2019s contingent liabilities, which are state obligations that could result in expenditure if a specific event occurs.<\/p>\n

The government closely monitors these liabilities, which also include provisions for multilateral institutions and other fiscal obligations.<\/p>\n

Godongwana, since his appointment as Finance Minister in 2021, has taken a \u201ctough love\u201d approach towards supporting struggling SOEs.<\/p>\n

While he was instrumental in Eskom\u2019s massive debt relief package in 2023, Godongwana has taken a tough stance on supporting other SOEs like the Post Office and the SABC.<\/p>\n

While this has resulted in a decline in the state\u2019s contingent liabilities, they remain substantial, with the National Treasury flagging this burden in its fiscal risk statement in the latest Medium-Term Budget Policy Statement (MTBPS).<\/p>\n

Godongwana\u2019s MTBPS in November revealed that the government\u2019s contingent liabilities declined from 19% of GDP in 2020\/21 to 15.7% in 2025\/26.<\/p>\n

In addition, the government\u2019s guarantee portfolio declined marginally from R708.7 billion in March 2025 to R707.8 billion in June 2025.<\/p>\n

However, the Treasury explained that several major SOEs remain in financial distress and, therefore, are reliant on government support.<\/p>\n

This is concerning, especially considering that, while the guarantee portfolio declined, the government\u2019s exposure increased by R6.2 billion.<\/p>\n

This is because SOEs continued to draw on existing guarantees, with the Treasury highlighting Transnet\u2019s R4 billion guarantee and R1.1 billion each from Eskom and the TCTA.<\/p>\n

In 2025\/26, the government also issued R145.8 billion in additional guarantees to Transnet to support the rail and port operator in addressing funding shortfalls, liquidity pressures and debt redemptions.<\/p>\n

This additional support brought the total guarantees issued to Transnet to R196.3 billion.<\/p>\n

For More News And Analysis About South-Africa<\/span> Follow Africa-Press<\/span><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – South-Africa. South Africa\u2019s government guarantees to state-owned enterprises (SOEs) have gone from R64.5 billion in 2008 to R707.8 billion in less than two decades. The biggest contributors to this debt are Eskom, Renewable Independent Power Producers, Transnet, the Trans Caledon Tunnel Authority (TCTA), and Sanral. Over the past few years, the National Treasury, […]<\/p>\n","protected":false},"author":84,"featured_media":94445,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[275],"class_list":["post-94446","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-south-africa-2"],"yoast_head":"\nSouth Africa\u2019s government on the hook for R700 billion - South Africa<\/title>\n<meta name=\"description\" content=\"South Africa\u2019s government guarantees to state-owned enterprises (SOEs) have gone from R64.5 billion in 2008 to R707.8 bi ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Africa\u2019s government on the hook for R700 billion\" \/>\n<meta property=\"og:description\" content=\"South Africa\u2019s government guarantees to state-owned enterprises (SOEs) have gone from R64.5 billion in 2008 to R707.8 bi ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion\" \/>\n<meta property=\"og:site_name\" content=\"South Africa\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2025-12-18T16:00:23+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-12-18T16:05:22+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2025\/12\/sm_1766061271.06583.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1024\" \/>\n\t<meta property=\"og:image:height\" content=\"576\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"South Africa\u2019s government on the hook for R700 billion\",\"datePublished\":\"2025-12-18T16:00:23+00:00\",\"dateModified\":\"2025-12-18T16:05:22+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion\"},\"wordCount\":596,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2025\/12\/sm_1766061271.06583.jpg\",\"keywords\":[\"South-Africa\"],\"articleSection\":[\"all news\",\"economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africas-government-on-the-hook-for-r700-billion\",\"name\":\"South Africa\u2019s government on the hook for R700 billion - 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