Cautious optimism in South Africa over new laws for Elon Musk's Starlink

The business sector has remained cautiously optimistic amid the possibility of a new law that could accommodate South African-born but US-based tech billionaire, Elon Must, to operate his internet company in South Africa.

This comes after the Minister of Communications and Digital Technologies, Solly Malatsi, on Friday announced in a policy directive the proposed relaxing of Black Economic Empowerment (BEE) policies in the ICT sector. 

The proposal would allow Musk’s satellite internet service to operate in the country without the usual requirements for 30% ownership to historically-disadvantaged groups, instead focusing on local investment and rural access. 

“This move was designed to break a long-standing deadlock and signal South Africa’s openness to innovative solutions, even as broader negotiations remained stuck,” said Bianca Botes, director at Citadel Global.

Musk has falsely repeatedly claimed that he could not operate Starlink in South Africa because he is not black.

The proposal to ease B-BBEE requirements has been met with criticism from several opposition parties in Parliament, although some parties within the Government of National Unity said the move would provide greater and cheaper internet access in the country, which is burdened by some of the world’s highest data prices.

The Portfolio Committee on Communications and Digital Technologies has summoned Malatsi to brief Parliament on Tuesday the newly issued policy directives aimed at easing Broad-Based Black Economic Empowerment (B-BBEE) requirements for licensing satellite services.

The chairperson of the portfolio committee Khusela Diko said the “gazetted policy directions appear to be in contravention of the Electronic Communications Act and in favour of low-Earth orbit (LEO) satellite provider SpaceX”.

Critics have asserted that the timing of these proposed laws was too coincidental following closely on the heels of President Cyril Ramaphosa's remarks about accommodating Musk and his ventures in South Africa during his working visit to the White House.

Wary of Musk’s provocative stance on issues like alleged “white genocide” in South Africa, detractors are concerned about the repercussions of welcoming a businessman whose actions challenge the very fabric of national interests.

“You can't come up with laws that are accommodating to an individual. Our country is gone if that happens. And this is the very same individual who is insulting us left, right, and center, accusing us of white genocide, even if his father stays here,” said Black Business Council CEO, Kganki Matabane on Sunday.

“And this is the very same person who was threatening Ukraine to switch off Starlink in Ukraine if Ukraine does not comply with what they want. So imagine the safety of South Africa and the safety of South African data with that type of person.”

This comes as Musk’s SpaceX-owned Starlink is steadily making strides in a number of countries in Africa. Last month, Lesotho granted a 10-year operating license to SpaceX's Starlink, allowing the company to provide satellite internet services in the country.

Starlink first launched its operations in Africa at the beginning of 2023, when Nigeria became the first country on the continent to be granted access to the LEO satellite technology. It is supported by a network of over 6 750 LEO satellites, which SpaceX has been launching in batches since 2019.

While proponents of satellite internet argue that Starlink could boost competition and connectivity across the country, critics remain adamant that any investment should comply wholly with South Africa's established legislation.

“We are not against Starlink or any other low Orbit satellites because there are many other low orbit satellites in China and other countries. We’re not against any investment into South Africa,” said Matabane.

“We're against trying to change laws of a sovereign country to accommodate an individual or to accommodate a company. Remember, Elon Musk's company did not even attend the hearings at the Icasa. The amendments can be made as long as they are not made to try and accommodate one company or one individual, because that means we would have lost our sovereignty as a country. And that cannot be allowed.” 

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