Elon Musk’s satellite internet company Starlink is reportedly planning a R2 billion investment in South Africa, potentially paving the way for its entry into the country despite ongoing regulatory challenges tied to Black Economic Empowerment (BEE) laws.
According to reports, the investment would support infrastructure development to serve not only South Africa but also the Southern African Development Community (SADC) – a 16-member regional bloc.
In a bid to comply with local conditions without ceding equity, Starlink has proposed using South African companies for infrastructure-related needs including land leasing, fibre connectivity, power supply, security, and maintenance services.
Viewed as a workaround
The reported strategy is viewed as a workaround to South Africa’s existing empowerment rules, which require foreign tech firms to partner with Black shareholders to obtain operating licences.
South Africa-born Elon Musk has publicly criticised these laws, calling them “openly racist” and indicating he would not give up equity in Starlink.
However, Communications and Digital Technologies Minister Solly Malatsi is considering a revision to current policy.
His department has proposed alternatives to equity partnerships for satellite providers – such as investment in Black-owned businesses and infrastructure as qualifying criteria.
“We want to see tangible investment into the South African economy, especially in marginalised communities,” Malatsi noted in a previous statement.
The decision to grant Starlink an operating license ultimately lies with the Independent Communications Authority of South Africa (ICASA), although Malatsi’s department plays a key role in shaping licensing criteria.
Starlink is aiming to finalise a deal before South Africa hosts the G20 Summit in Johannesburg in November, a high-profile platform that could highlight Musk’s return to his country of birth in a transformative digital initiative.
If successful, Starlink’s investment could significantly enhance internet access and connectivity across the region, especially in underserved rural areas.
Would you be happy to have access to Starlink in South Africa?
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