São Tomé and Príncipe’s water and electricity company Emae needs “urgent restructuring” as it is “technically bankrupt”, the company’s managing director said on Monday in São Tomé.
Celestino Andrade said the introduction of cost-cutting and revenue-raising measures should involve the International Monetary Fund (IMF) and the World Bank, under the country’s aid programme.
Having admitted the company’s potential “insolvency”, Andrade maintained that “the assets and rights that Emae has are not enough to cover obligations” to third parties.
Giving some examples of the company’s situation, the managing director said that Emae owes about US$140 million to the national fuel and oil company ENCO, due to non-payment of fuel purchases to power thermal power plants.
Andrade said the company still has a debt of US$80 million and other suppliers of goods and services, as well as a bank liability of about US$3 million.
Emae spends an average of US$2 million per month on 2.2 million litres of fuel for its interconnected and isolated power plants.
Owned by the Sao Tome state, Emae is the only power producer and distributor in the archipelago. (Macauhub)