Power blackouts endanger South African president Cyril Ramaphosa’s reforms

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The anonymous notes to South Africa’s electricity workers were menacing. “If you dare work during this shutdown, you are subjecting yourself to risk,” the notes said. “Take this as a warning.”

Within hours, South Africa was plunged into rolling blackouts. On a cold winter night, hundreds of neighbourhoods across the country were without light and heat. The blackouts extended into a second night on Friday, with a risk of more outages in the coming days as labour tensions continue.

The electricity crisis, the first in three years, is the latest sign of trouble facing South Africa’s new president, Cyril Ramaphosa, as he struggles to clean up a legacy of corruption and mismanagement from the nine-year rule of Jacob Zuma.

While he has been praised for his early steps to get rid of corrupt officials and begin reforms of state agencies, Mr. Ramaphosa is hobbled by major challenges: bitter feuding within the ruling party, a sluggish economy, a weakening currency and crippling debts in key state-owned companies.

The economic and political setbacks are an indication that Mr. Ramaphosa’s clean-up campaign will take longer than his supporters had hoped. The delays could inflict further damage on African growth, already weighed down by South Africa’s stagnant economy.

South Africa’s power utility, Eskom, is crucial to Mr. Ramaphosa’s reform strategy. After years of corruption and over-spending, Eskom is saddled with a staggering debt of US$27-billion. Its managers had been focused on cozy insider deals with politically connected businesses rather than finding a turnaround strategy for the struggling company. The utility, under new management this year, has been trying to slash costs by seeking a wage freeze – triggering a fierce battle with its unions, who have demanded a 15-per-cent wage increase.

For days, Eskom had assured the country that there was no risk of electricity blackouts, despite the labour tensions. Its employees are deemed essential workers and cannot legally strike. But on Thursday, its assurances were hastily scrapped as some workers began illegal strike action.

At many of Eskom’s power stations, there were road blockades, attacks on staff who did not participate in the strike, and sabotage of electricity equipment. All road deliveries of coal were halted by intimidation tactics, Eskom said. Some employees were violently removed from their vehicles as they tried to report to work.

On Thursday night, electricity distributors in Johannesburg and Cape Town were shocked to learn – with just a few minutes notice – that Eskom was ordering them to introduce power-cutting measures, including rolling blackouts. Many homes were thrown into darkness with no warning.

South Africa’s currency, the rand, slipped into further losses as the outages began. The rand had made substantial gains after Mr. Ramaphosa replaced Mr. Zuma as leader of the ruling African National Congress last December, but those gains have been reversed, and the rand has fallen back to its levels of last year. The weaker rand is expected to hit consumers by triggering a rise in gasoline prices.

The last electricity blackouts, in 2015, caused significant damage to South Africa’s economy, contributing to a slowdown that plagued the country for years. A mild recovery had been predicted this year, but that might now be in doubt.

On Friday night, one of Mr. Ramaphosa’s senior cabinet ministers announced that the labour negotiations would resume and the attempted wage freeze was “off the table.”

Credit ratings agency Fitch said on Friday that it would keep South Africa’s sovereign credit rating at junk status. “Financial challenges at key state-owned enterprises remain substantial,” it said.

Mr. Ramaphosa is facing political and legal challenges too. National prosecutors have lost two court battles in their attempts to seize assets from the controversial Gupta family, the tycoons at the heart of the biggest corruption scandal of the Zuma era. And despite corruption charges against him, Mr. Zuma has remained defiant, mobilizing rallies with big crowds of supporters who have denounced the Ramaphosa reforms.

By refusing to fade away into retirement, Mr. Zuma is fueling divisions in his traditional stronghold, KwaZulu-Natal province. The split led to chaos at a recent ANC conference in the province, forcing its cancellation.

The divisions could hurt the ANC’s popularity in the province, leading to a decline in its vote total in next year’s national election.