Residents complain to World Bank about Eskom loan

Limpopo residents on Tuesday filed a complaint with the World Bank inspection panel about the $3,75-billion loan sought by Eskom to help finance the Medupi coal-fired power plant.

The granting of the loan would significantly damage their health, livelihoods and the environment, they submitted in the complaint filed on their behalf by Earthlife Africa and groundWork.

Earlier on Tuesday, Energy Minister Dipuo Peters told Business Unity South Africa (Busa) that all South Africans should support the loan because 25% of the population was still waiting for access to basic minimum electricity.

In reality, however, the project would largely benefit major industries which consumed electricity below cost, and whose apartheid-era secret agreements prevented them from sharing the costs associated with construction of the project and repayment of the loan, said Earthlife Africa and groundWork.

Earthlife Africa spokesperson Tristen Taylor said none of Medupi’s output would be for the poor, but would instead service multinational firms.


Taylor also questioned how the African National Congress (ANC) would profit from the loan through its investments.

The Democratic Alliance wrote to the World Bank in March asking whether the loan application would be affected by a finding that former Eskom chairperson Valli Moosa acted improperly in awarding a R38,5-billion Medupi power station contract to the Hitachi consortium, in which the ANC has an interest.

The ANC reportedly stands to benefit by up to R5,8-billion through the 25% stake its investment arm Chancellor House has in Hitachi.

Earlier in March, Public Enterprises Minister Barbara Hogan warned of dire consequences for the country’s economy if Eskom did not secure the $3,75-billion loan.

The loan is expected to go before the World Bank’s board of directors for approval on Thursday.

Earthlife Africa and groundWork contend that the power project violates numerous World Bank policies and poses considerable threats to local communities and to the South African society at large.

They argue that the hidden costs of the loan include the affect on health of air pollution, elevated sulphur dioxide levels, and mercury residue in their water, air and land. There would also be constrained access to water and the degradation of land and water in what was a largely agrarian area.

“Already illegal sand mining operations are taking place in the area for the building of Medupi,” they claimed.

These problems would be compounded by plans for a number of new coal mines and plants in the area.

Sasolburg resident Caroline Ntapoane said her concern with the loan was personal.

“I know first-hand what the communities have to look forward to, because we experience it every day.

“We live it in the polluted air we breathe, when our water taps run dry, and when our children get sick. We shouldn’t have to choose between electricity and our health,” she said. — Sapa

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