South Africa has plunged back to prolonged power outages after easing over the past two months due to breakdowns and urgent repairs, President Cyril Ramaphosa said on Tuesday.
Africa's most developed economy is on track to have its worst power cuts on record this year, impacting businesses in an economy already hampered by rising interest rates.
The rand weakened against the dollar and shares fell on Tuesday as investors priced in the impact of the deeper power cuts on the economy.
The return to "Stage 6" power cuts for the first time since July announced by state utility Eskom on Monday translates to daily power outages lasting nearly 10 hours.
"There is short term pain for longer term gain," Ramaphosa said on Tuesday evening in televised comments referring to the urgent maintenance work being carried out at some power stations.
"I think we are obviously worried whenever there's load-shedding but as we go through this process now, we might see positive light in the long term."
Eskom's main workers' union asked the utility to implement a measurable strategy to overcome the power cuts, saying in a statement the country’s economy "cannot afford to endure the adverse effects caused by the unreliable electricity supply."
Although economy expanded by 0.6% in the second quarter of 2023, compared to 0.4% in the first quarter, analysts said this was largely because the power cuts had eased somewhat. They warned that the increased power outages would likely damage future growth prospects.
"The outlook for the rest of the year remains relatively bleak," the Nedbank Group Economic Unit said in a note to clients. "Load-shedding has returned with a vengeance as Eskom resumed regular maintenance."
Investec bank said in a note commenting on the second quarter GDP figures that "electricity generation declined by -7.0% y/y in the second quarter and remains a significant impediment to the country’s growth potential."
(Editing by Seban Scaria email@example.com)