How international pressure fast-tracked policy changes that prioritise foreign profits over local ownership

IOL News

23-06-2025

President Cyril Ramaphosa suggests Starlink as a solution, which raises questions about the underlying motives, says the writer.
Image: Jonathan Raa/NurPhoto/AFP
On May 21, we witnessed an embarrassing scene of the presidential delegation in the Oval Office. Patrick Gaspard, a former American ambassador in South Africa under the Barack Obama administration, explained that Trump had turned the meeting with Ramaphosa into a "shameful spectacle" and "savaged him with some phoney snuff film and brutal rhetoric" (Gaspard, 2025).
This was purportedly done to remedy the very high already present tensions between the US and South Africa that have escalated since the Trump administration took office.
Interestingly, just 48 hours later, Communications Minister Solly Malatsi gazetted a new direction of policy to ICASA, permitting Starlink and other foreign investors to "harmonise" current ICT sector requirements (Department of Communications & Digital Technologies, 2025). The regulations previously demanded that at least 30% of shares be held by historically disadvantaged individuals. Current ICT Sector Rules
Due to the expansive and strategic nature of the telecoms sector – controlling how South Africans communicate, access information, and participate in the digital economy – the previous requirement for foreign telecommunications licensees to sell 30% of their local subsidiaries to historically disadvantaged groups ensured that black South Africans didn't just use these services, but owned and profited from the infrastructure serving their communities (Broad-Based Black Economic Empowerment Act, 2003).
ICASA's Role
ICASA is the regulator of South Africa's telecommunications sector, essentially the gatekeeper that licenses all companies wanting to provide internet, phone, or TV services (Independent Communications Authority of South Africa Act, 2000). Because they enforce the ownership requirements, they're the ones who need to ease these regulations to make room for Starlink and other prospective foreign investors. As the Department of Communications & Digital Technologies noted, this wouldn't just benefit one company but would apply to all ICT companies, including those from China and the Middle East (Department of Communications & Digital Technologies, 2025). Equity Equivalent and Ownership 'Workaround'
The 'sidestep' or 'harmonising' commonly referred to speaks to Equity Equivalent programmes – this is when companies are permitted to avoid giving up ownership but instead can contribute through community projects worth the same value as what that 30% ownership would have been. This usually takes the form of skills and training development, job creation, and supporting black-owned suppliers (Department of Trade, Industry and Competition, 2019).
In 2019, the South African government piloted this approach through the automotive industry, where BMW, Ford, and Toyota did not have to give up ownership but instead committed to ploughing back through skills development and funding for black-owned suppliers (Automotive Industry Development Centre, 2019). Essentially, companies keep their investments, shareholding, and decision-making power, but offer communities the equivalent value of what they would have given up in ownership.
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Aphelele Mtwecu, a proud member of the Activate Change Drivers Network and a2016 Activator. She is a content writer, activist
Image: Supplied
Contentions of Timelines and Due Processes
So, how exactly does a presidential delegation meeting occur on Wednesday and have a new policy gazetted by Friday? The credibility of how this gazette played out is questionable. According to reports, the delegation included three other officials who were familiar with what Starlink would bring to the South African economy, granted this wasn't a spontaneous engagement.
However, here is the problem: South Africa, with all its flaws, values and upholds consultative processes. A major economic policy shift such as this one would normally require public hearings or parliamentary reviews to protect the Republic from exactly these kinds of overnight decisions (Promotion of Administrative Justice Act, 2000). In this matter of harmonising BEE laws, regardless of existing contentions, this is an important historical policy that would impact our state of affairs deeply.
It is further alarming how these kinds of events occur under the supposed sensitivity of the GNU government, where consensus-building across coalition parties should be central to major decisions. Unless it is the citizens who are blindfolded, and we simply do not know there was a prior agreement between parties to fast-track this change.
Pseudo Altruism
According to Statistics South Africa's latest general household survey, only 1.7% of rural households had an Internet connection at home in 2023 (Statistics South Africa, 2024). This devastating statistic has become the most compelling reason for the urgency of Starlink's operations in South Africa.
As we understand it, Starlink has been piloted in some South African rural communities and has indeed yielded positive results for farmers as well as the education sector. The need is undeniable – rural communities lack the same coverage and access compared to urban areas. This digital divide is real and valid. Currently, technology optimisation is everything, especially in education, and for children to have access to connectivity is critical.
But here's my question: out of all telecommunications services globally, can we prove that Starlink is the crème de la crème of satellite coverage? Have other avenues been exhausted before we convinced ourselves we had no choice?
And if Starlink had indeed piloted programs in rural areas and seen the benefits, why wouldn't they yield further to South Africa's legislative and broader economic equity by accepting a BEE partner under ICT BEE laws? If rural connectivity was so important to them, why was this condition such a deal breaker?
In these cases, material interests and profit margins trump everything else. And that makes me question their philanthropic intent "to save rural communities" entirely.
Digital Inclusion* (*Economic Participation Sold Separately)
The Department of Communications highlighted a significant issue, emphasising that the policy is not just about Starlink but is intended to address the growing digital divide. However, I do not agree with the methodology. We must ensure that our approach to digital inclusion does not compromise future sustainability.
We have identified the need, but here's the broader question: how can you give a society tablets when they cannot even harvest food to sustain themselves and their families? How is this different from any other interventions that have squandered the hopes of our people, only to leave them hanging with false hope and shattered dreams?
What's the point of digital inclusion without economic participation? We're essentially saying to rural youth: 'Here's access to the internet, but the profits from connecting you will flow to foreign shareholders.' This is the bread vs. bandwidth dilemma – we're trading long-term ownership for short-term access, creating dependency rather than empowerment.
Communications Minister Solly Malatsi gazetted a new direction of policy to ICASA, permitting Starlink and other foreign investors to "harmonise" current ICT sector requirements (Department of Communications & Digital Technologies, 2025).
Image: X / IOLGraphics
Racial Capitalism in Real Time
We are not oblivious to the sequence of events unfolding in the terrain we find ourselves in. The actions of certain global leaders have influenced policies that affect digital inclusion and economic participation.
After our ambassador was dismissed, claims emerged about land confiscation in South Africa, which were used to support allegations of land grabs and genocide. He curtain-calls this performance to the globe, summons 'Cupcake' to the Oval Office, and at the brink of our president making pleas for him to stop, the Trump-Musk axis asks: 'What will you give us in return?'
Our president suggests Starlink as a solution, which raises questions about the underlying motives.
But these dynamics of power and racial manipulation speak deeply to what Cedric Robinson identified as racial capitalism, where racism isn't incidental to capitalism, but fundamental to its operation (Robinson, 2000). As Robin D.G. Kelley reflects on Robinson's work, this system not only exploits black labour but also uses black societies as laboratories for testing how far capital can push without resistance (Kelley, 2017). Du Bois saw this clearly: the colour line isn't just about prejudice, it's about who gets to own, who gets to profit, and who gets relegated to being grateful for scraps (Du Bois, 1903).
We need to critically examine these issues, as seen in 2019 when BMW, Ford, and Toyota used 'equity equivalent' programs to avoid ownership responsibilities. But where's the evidence that this worked? Are there measurably more black-owned automotive companies today? Now they want us to accept the same promise in telecoms, dressed up as digital inclusion.