Godongwana urges developed countries to help small economies transition as SA fixates on coal

17 May 2023 - 09:34
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Finance minister Enoch Godongwana said the National Treasury was working on deepening South Africa’s trade links with the rest of the African continent and with other parts of the global south, particularly through its grouping with Brazil, Russia, India and China.
Finance minister Enoch Godongwana said the National Treasury was working on deepening South Africa’s trade links with the rest of the African continent and with other parts of the global south, particularly through its grouping with Brazil, Russia, India and China.
Image: Ruvan Boshoff

Minister of finance Enoch Godongwana says developed countries have a responsibility to support developing economies in their energy transition, even as South Africa plans to extend the life of coal-fired power plants and call on private partners to invest in Eskom’s coal fleet. 

Godongwana delivered his budget vote speech in parliament on Tuesday.

His remarks come as financiers, the latest being Standard Chartered, have said they are not likely to invest in Eskom’s coal fleet as global funders are backing away from fossil fuels.

The budget vote comes after minister in the presidency for electricity Kgosientsho Ramokgopa announced government’s plan to stave off the most severe levels of load-shedding this winter, included extending the life of Eskom’s coal fleet. 

Godongwana said a critical element of South Africa’s position in the international and global community was the context of the Just Energy Transition, agreed on at COP27 in Egypt last year. 

“South Africa is using these platforms to argue that developed nations should do more to support the energy transitions of developing nations, in a manner that does not worsen pre-existing financial and fiscal vulnerabilities.”

Godongwana said the National Treasury was working on deepening South Africa’s trade links with the rest of the African continent and other parts of the global south, particularly through its grouping with Brazil, Russia, India and China (Brics). 

“South Africa is the chair of the Brics group in 2023. This will culminate with the hosting of the 15th Brics summit in August. South Africa will use the event to highlight national and continental efforts to revive and reform the global economy in a more equitable manner,” he said. 

South Africa’s participation in structures such as the World Bank, International Monetary Fund, and G20 were key to strengthening the country’s position within multiple forums. 

“In our discussions, for example about the common framework for debt resolution, South Africa has stressed the importance of creditors committing to providing debt treatments that do not further indebt low-income countries and that the burden of restructuring is shared equally.”

Opposition MPs slammed the government for its handling of matters, including last week’s fracas with the US embassy in South Africa, in which ambassador Reuben Brigety said he had reason to believe South Africa was supplying Russia with weapons in its military campaign in Ukraine. 

The ambassador has reportedly apologised for this statement. Russian President Vladimir Putin’s visit to South Africa in August for the Brics summit puts the country in a tight spot as a signatory to the Rome Statute, as the International Criminal Court has issued a warrant for Putin’s arrest.

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