South Africa’s government recently unveiled plans to introduce policy directives that would allow equity equivalent programmes, designed to attract foreign investment into the country’s telecommunications sector.
This shift in policy is expected to eliminate some of the obstacles that had previously discouraged SpaceX’s Starlink satellite service from launching in the country.
For nearly four years, the South African telecommunications industry faced uncertainty following the publication of new local ownership regulations by the Independent Communications Authority of South Africa (Icasa) on 31 March 2021.
These regulations, which replaced the provisions in the Electronic Communications Act (ECA), mandated that telecommunications providers with a national footprint must be 30% black-owned, specifically by historically disadvantaged groups (HDGs).
However, these new rules were met with strong industry backlash, and Icasa suspended their implementation, leaving the sector in a state of ambiguity.
Communications Minister Solly Malatsi confirmed that he had instructed Icasa to develop equity equivalent programmes, aimed at increasing competition within the sector.
“The purpose of this move is to facilitate easier investment by international companies while ensuring that these investments contribute positively to South Africans,” Malatsi’s spokesperson, Kwena Moloto, explained.
Moloto further emphasised that the Department of Communications and Digital Technologies (DCDT) was committed to fostering a more competitive market that would lead to improved services, accessible prices, and broader internet access.
The announcement came after prolonged discussions surrounding Starlink’s delayed entry into the South African market.
Starlink, SpaceX’s satellite internet service, had initially planned its launch in February 2021, but was forced to postpone after Icasa insisted that the company comply with the new black ownership requirements.
As the regulations remained suspended, Starlink’s plans were pushed back to 2023, and eventually, to an "unknown" launch date.
In September 2024, President Cyril Ramaphosa met with SpaceX CEO Elon Musk to discuss the possibility of Starlink investing in South Africa.
Ramaphosa stated, “I have had discussions with him and have said, Elon, you have become so successful, and you’re investing in a variety of countries; I want you to come home and invest here.”
The introduction of equity equivalent programmes was seen as a critical step towards easing the regulatory challenges that have hindered Starlink’s launch in South Africa and across the continent.
