First major investment deal under Cyril Ramaphosa

First major investment deal under Cyril Ramaphosa

- South Africa signed long-delayed renewable energy contracts worth R55.92 billion on Wednesday

- The deal is the first major investment deal under President Cyril Ramaphosa

- The deal is for 27 solar and wind projects that were held up under Zuma's term because he favoured nuclear power

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President Cyril Ramaphosa has just signed a major investment deal in renewable energy contracts worth R55.92 billion.

The signing of power purchase agreements for the 27 mostly solar and wind projects was held up by former president Jacob Zuma, who favoured nuclear power plants.

The deal was also held up by a last-minute legal challenge by the Numsa labour union and Transform RSA lobby group, but a court rejected their application for an urgent interdict last week.

Ramaphosa has promised to unlock investment and kick-start economic growth in South Africa, and this deal is a victory towards that, gathered.

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“This will bring much-needed policy and regulatory certainty and maintain South Africa’s position as an energy investment destination of choice,” the energy ministry said in a statement.

Ramaphosa, has prioritised revamping the economy by improving the situation of state-owned enterprises, like Eskom.

The power utility will purchase power from independent producers as part of the deals agreed on Wednesday.

Opponents of the renewable contracts argued that Eskom could not afford the additional financial burden and that they would lead to job losses in the coal sector.

South Africa relies on coal-fired plants for more than 80 percent of its electricity generation, while renewables contribute around 7%.

Transform RSA, which opposed Zuma’s removal as head of state, said it would continue to fight the renewable deals and had appealed last week’s court ruling dismissing its application for an interdict.

“Eskom simply does not have the liquidity, cashflow and strong balance sheet to support this hideous gamble on the fiscus and state electricity supplier,” Transform RSA president Adil Nchabeleng said.

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