Eskom-China loan: We will not sell the country's silver, says Ramaphosa

There are no conditions to the R33bn loan from China Development Bank to Eskom, and none of SA's assets will be seized in the event of a default, President Cyril Ramaphosa has reiterated. 

The president on Tuesday responded to questions from African Christian Democratic Party (ACDP) leader Kenneth Meshoe about whether any of SA's assets had been attached as guarantees for the loan to the power utility.

The president described the loan as "straightforward vanilla" and assured Parliament that there was no security for it in the form of assets.

The loan was agreed to under government's existing guarantee framework, he said.

"We are not in the business of entering into agreements and knowing we will default on those agreements. We abide by the terms of the agreements that we enter into.

"Eskom has not failed to live up to the payments it should live up to when it comes to repaying loans. We do not intend to have Eskom defaulting on agreements it is entering into," Ramaphosa said.

In the end, government is the only backstop to all loan processes, he reiterated.

"We don't give specific assets; we do not even give land or vehicles as a guarantee," he said.

Government guarantees are worth more than assets, he explained. Incidents in other countries where creditors seize assets will not be repeated in SA, he added

"I will not allow it to happen …  We will not sell the country's silver."

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER