South Africa’s telecom sector is continuing to face rising tensions.
Khusela Diko, the chair of Parliament’s Communications Committee, is criticizing Minister Solly Malatsi over his push to implement the Equity Equivalence Investment Programmes (EEIP).
Under this program, foreign telecom companies would be exempt from the usual 30% black ownership rule if they invest in areas like infrastructure or training.
In her criticism on X (formerly Twitter), Diko claimed that Malatsi is trying to loosen the rules to support big businesses, particularly in a bid to pave the way for Elon Musk’s Starlink.
Diko strongly opposes the implementation of EEIP, as she believes it is a covert attempt to weaken South Africa’s transformation laws.
However, Malatsi is not backing down. He maintains that EEIPs are legal and have already been used in industries like car manufacturing to attract international investment.
He also pointed out that the Cabinet has approved rolling out these programs in the ICT sector, specifically to support underserved rural areas. His team believes that competition from companies like Starlink could help lower data costs.
At the heart of the controversy is, of course, Starlink. While Malatsi is eager to bring Starlink into the country, Diko is firmly against it.
She argues that if the 30% ownership rule is an issue, it should be properly changed through legislation, but no special allowances should be made for private companies.