South Africa’s Communications Minister Solly Malatsi has strongly refuted claims that the government is weakening its Black Economic Empowerment (BEE) laws to accommodate Elon Musk’s satellite internet company, Starlink.
Speaking before a parliamentary committee on Tuesday, May 27, 2025, Malatsi addressed growing criticism that policy changes published last Friday were a reaction to President Cyril Ramaphosa’s recent visit to the United States and meeting with former President Donald Trump.
The contentious policy shift would allow foreign telecommunications companies, including Starlink, to meet BEE obligations through “equity equivalent” programmes such as investments in digital infrastructure rather than the standard requirement of selling 30% equity in their local subsidiaries to historically disadvantaged South Africans.
Critics, including opposition lawmakers and the chairperson of Parliament’s communications committee, have questioned the timing of the policy announcement. They argue it appears tailored to favor foreign interests, particularly given reports that Ramaphosa’s team had signaled potential business opportunities for Musk would be on the agenda during his U.S. visit. Ramaphosa later denied that Starlink was discussed.
Minister Malatsi maintained that the draft directive was part of a long-term strategy to attract multinational investment while maintaining the integrity of South Africa’s transformation agenda. “We are not attempting to open a special dispensation for Starlink or any other company or an individual,” he emphasized. “Transformation is sacrosanct in our country it’s a non-negotiable.”
Malatsi began developing the equity equivalent directive last year, arguing that it is essential to expand broadband access, particularly in underserved areas. SpaceX, Starlink’s parent company, had previously expressed concerns over local shareholding laws but voiced support for equity equivalent options.
Despite the backlash, Malatsi reiterated that the proposed changes remain aligned with South Africa’s empowerment objectives and that there is no attempt to bypass public scrutiny. “There is no underhand effort to railroad this into the South African public,” he assured lawmakers.
South Africa’s BEE laws remain a cornerstone of economic redress, and the unfolding debate over Starlink’s entry continues to spotlight the complex balance between transformation and global investment.
