South Africa is revising its Black Economic Empowerment laws to potentially allow Elon Musk’s Starlink to operate in the country, balancing economic inclusion with technological advancement.
At a Glance
- South Africa is considering changes to laws requiring 30% black ownership for telecom companies to allow Starlink entry
- Elon Musk, born in South Africa, previously claimed Starlink couldn’t operate there “because I’m not black”
- Draft policy proposes alternatives like investing in local suppliers or creating jobs instead of ownership transfer
- Policy changes may improve deteriorating US-South Africa trade relations under the Trump administration
- Similar equity equivalent programs have been approved for Microsoft, Hewlett Packard, and Samsung
Balancing Economic Equity and Technological Progress
South Africa’s government has published a draft policy that could ease Black Economic Empowerment (BEE) requirements in the telecommunications sector, potentially opening the door for Elon Musk’s Starlink satellite internet service.
The current law mandates that telecom companies transfer 30% equity to historically disadvantaged groups, a requirement designed to address economic inequalities stemming from the apartheid era. This regulation has prevented Starlink from entering the South African market, with Musk publicly criticizing the policy.
The proposed changes would allow companies alternatives to direct ownership transfer, such as investing in local suppliers, creating jobs, or funding black-owned small businesses. This approach, known as “equity equivalent programs,” has previously been approved for international corporations including Microsoft, Hewlett Packard, and Samsung operating in South Africa. The draft policy is currently open for public comment for 30 days before any final decisions are made.
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Source: /mg*co*za
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Musk’s South African Roots and Ongoing Controversy
Elon Musk, who was born in South Africa before emigrating to North America, has been particularly vocal about the BEE laws. His statements have sparked controversy both domestically and internationally. “Starlink is not allowed to operate in South Africa, because I’m not black,” Musk claimed, drawing attention to what he views as discriminatory practices in his birth country. This characterization of the laws has been disputed by many South Africans who view BEE as a necessary corrective measure for historical injustices.
The South African government maintains that BEE policies are designed to create economic opportunities for populations systematically excluded during apartheid. However, the government now appears willing to consider modifications that would still advance economic inclusion while accommodating international businesses like Starlink. The policy revision reflects a pragmatic approach to balancing social justice goals with economic development objectives in the rapidly evolving telecommunications sector.
International Relations and Economic Strategy
The timing of these potential policy changes coincides with efforts to improve strained US-South Africa relations under the Trump administration. Recent talks between the two nations aimed “to strengthen bilateral trade ties, increase investments for mutual benefit and forge collaboration in technological exchanges,” according to the South African presidency. While discussions about Starlink were reportedly part of these meetings, officials emphasize that the draft law is intended to benefit the entire telecom sector, not just Musk’s company.
The US government has suggested that American companies should be exempt from South Africa’s ownership requirements, viewing them as potential barriers to trade. Meanwhile, neighboring Lesotho recently granted a license to Starlink, increasing pressure on South Africa to find a workable solution. The proposed policy changes appear designed to attract investment into the country’s ICT sector while providing licensing certainty for various telecom services, potentially strengthening South Africa’s position in the global digital economy.
