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The Dysfunctional Company That's Wrecking South Africa's Economy

Blackouts are a regular occurrence because Eskom Holdings, almost 100 years old, can't provide enough power. Mismanagement and debt are a big part of the story.

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A view of Johannesburg shows Sandton, Africa’s richest square mile, on the horizon. But suburbs on the left and foreground remain in darkness. 

A view of Johannesburg shows Sandton, Africa’s richest square mile, on the horizon. But suburbs on the left and foreground remain in darkness. 

 Photographer: Ilan Godfrey for Bloomberg Markets

In late June, the coldest part of the Southern Hemisphere winter, the power went out in South Africa. For as many as eight hours a day, right into early July, traffic lights went dark, factories and offices shut down, and meals had to be served cold.

These weren’t the first power outages, but they were the worst yet. Intermittent supply cuts over the past 14 years had already sapped business confidence and limited private investment in South Africa. In 2017, when he was leading Goldman Sachs Group Inc.’s business in sub-Saharan Africa, Colin Coleman described the struggles of state power company Eskom Holdings SOC Ltd. as the biggest threat to the South African economy.