South Africa might bypass Black ownership rules for Musk

Starlink, the satellite internet service founded by Elon Musk, may be on the verge of launching in South Africa following recent changes in government policy. These proposed changes aim to ease strict ownership requirements in the country’s telecommunications sector, which could pave the way for Starlink to enter the market.

New Policy Framework

The South African government has published a “proposed policy direction” that addresses the ownership stipulations enforced under the Black Economic Empowerment (BEE) laws. Under these laws, telecom companies are required to have at least 30% ownership by historically disadvantaged groups. However, the telecommunications sector is subject to stricter ownership mandates compared to the broader information, communication, and technology (ICT) sector.

Investment and Economic Growth

Communications Minister Solly Malatsi has introduced a regulatory framework that allows the Independent Communications Authority of South Africa (ICASA) to adjust existing laws in accordance with new ICT amendments. Starlink can potentially comply with BEE requirements by participating in “equity equivalent investment programs” that contribute to local development efforts. Existing tech giants like Microsoft and Google are already utilizing this model for their operations in South Africa.

This shift comes at a crucial time, as statistics suggest that every 10% increase in broadband penetration correlates with a 1.21% growth in GDP, emphasizing the importance of reliable internet access for economic progression. As South Africa grapples with inadequate telecommunications in rural areas, the introduction of satellite internet services like Starlink could be transformative for achieving comprehensive internet access across the nation.