South Africa is entering a critical phase in its ongoing effort to balance economic transformation with the demands of a competitive global economy. Recent developments in the ICT sector have intensified this debate, with a proposed policy directive from the Department of Communications and Digital Technologies sparking renewed scrutiny over how Broad-Based Black Economic Empowerment (B-BBEE) is applied.
By Simnikiwe Mzekandaba – IT Web
The directive, still in draft form, suggests revisiting strict local ownership requirements for telecom operators. Under current legislation, entities applying for operating licences must demonstrate at least 30% equity ownership by historically disadvantaged groups. However, the new proposal opens the door for equity-equivalent investment programmes (EEIPs) as a potential alternative—a shift that could allow multinational companies such as Elon Musk’s Starlink to operate in South Africa without local ownership.
While some view this as a pragmatic move to attract investment and improve connectivity, critics warn it could dilute the purpose of transformation legislation. The core concern is that, without ownership, black South Africans may continue to be excluded from meaningful participation in high-value industries, even as the country welcomes global players into its markets.
President Cyril Ramaphosa has recently doubled down on his administration’s commitment to transformation, framing B-BBEE not as a constraint, but as a moral and economic imperative. His remarks, delivered in response to international pressure—including from the Trump-aligned Heritage Foundation—underscore the need for South Africa to defend its right to pursue equitable growth on its own terms.
As the country considers how to modernize its policies in a digital age, the real challenge lies in ensuring that reforms do not compromise the transformative vision at the heart of South Africa’s democratic project. The future of economic inclusion may well depend on how effectively the country walks this tightrope.
