Letter: Eskom is growth stumbling block - Citizen

Treasury's forecast of an average growth rate of 1.8% over the next three years is likely to prove more hopeful than realistic.

Given the latest bout of rolling blackouts imposed on the country by Eskom, the country's industries will find themselves consistently hitting up against a very low growth ceiling.

Last year, the presidency announced that the limit for electricity self-generation without a licence would be lifted to 100MW; the move was widely praised, as this has long been touted as one of the best structural reform wins that government should pursue.

But lost in all the excitement was the fact that those businesses, mines and other entities that want to build their own capacity need to obtain a grid connection permit.

Thus, on the one hand government aims at less bureaucracy, but then undermines those very same goals on the other hand. Reports have emerged that indicated that the department of minerals and energy, as well as Nersa, are trying to make the new system as cumbersome and state-controlled as the old one.

This indicates that the same ideology that has produced the country's record unemployment rate and economic decline overwhelming state control and involvement in all facets of the economy and society is still clearly present in policymaking.

SA will be unable to fully utilise and benefit from increased commodity prices, for as long it is forced to rely on Eskom.

Chris Hattingh, Institute of Race Relations