GUGU LOURIE: Ditch BEE red tape to boost jobs and growth

All rules have their exceptions — in other words, it is the exception that proves the rule. This basic principle explains why SA’s rigid insistence on enforcing BEE compliance for Starlink amounts to economic self-sabotage. 

While Elon Musk’s dismissal of BEE as racial bias is misguided, the government’s refusal to grant operational flexibility to a transformative digital provider ignores SA’s deepening crisis, which includes stagnant GDP growth, mass unemployment and more than half of the population living in poverty. 

In an era where connectivity drives development, regulatory obstinance is costing SA jobs, investment and technological progress. Yet across Africa nations are racing to embrace satellite internet. Rwanda, Nigeria, Kenya and even Lesotho have licensed Starlink, recognising its potential to bridge digital divides to spur innovation and development. 

SA, however, remains entangled in ideological debates while its citizens endure inadequate and expensive internet. More than 600 US companies already operate in SA under equity-equivalent programmes, complying with BEE rules through skills development rather than forced ownership. 

Why should US-based Starlink, a potential game-changer for rural connectivity, be held to a different standard? This is a pertinent question considering that SA’s internet inequality is so pronounced. Millions in townships and rural areas rely on sluggish, unreliable connections, while urban businesses pay premium prices for less-than-satisfactory speeds. 

This isn’t just an inconvenience: it’s a structural barrier to education, healthcare, entrepreneurship and development, with schools in remote regions struggling with online learning due to poor connectivity, small, medium, and micro enterprises (SMMEs) losing opportunities because slow internet hampers digital trade and farmers lacking real-time data to optimise crops and mitigate climate risks.

Starlink’s low-latency broadband could end this malaise overnight, yet regulators cling to rigid BEE enforcement that prioritises paper compliance over real progress. As I reflect on BEE over the past 30 years I struggle to see the trickle-down effect for the poor majority.

The policy’s success is traceable to a small number of black elites, but its broader impact remains mediocre. It has failed to meet targets in job creation, enterprise development and economic expansion, particularly for women, youth and SMMEs. 

There is little or no historical evidence to back suggestions that forcing Starlink to sell a 30% stake to black shareholders will empower the masses — more likely, the usual band of elites will benefit. Such a move would likely saddle Starlink with partners that cannot, for whatever reason, add value.  

This would be a replication of failed models. We must shift from ownership-based BEE to impact-based empowerment, focusing on skills, infrastructure and inclusive growth. If SA is serious about growth, it must act decisively. Regulators must fast-track Starlink’s licence application and issue it with conditional waivers, as has been done for other strategic foreign investments. 

Replace equity dogma with skills mandates.  Real empowerment means training, not token shareholding. The government must also cut red tape to signal to foreign investors that SA is truly open for business. Shutting out Starlink under the guise of ideological purity will only serve to entrench digital exclusion and strangle innovation and development. 

The same short-sighted logic could extend to Vodacom’s potential partners, AST SpaceMobile, Amazon’s Project Kuiper, or MTN’s collaboration with Lynk Global, which just demonstrated the first successful satellite-to-mobile call in SA. 

Why sabotage progress when connectivity could revolutionise  education, healthcare and entrepreneurship for millions? Young South Africans could have access to the satellite industry not just as consumers, but as innovators. Training programmes in satellite tech, maintenance and software development could upskill young people yearning for meaningful careers, and help uplift SA. 

Instead of recycling narrow empowerment networks, why not create a pipeline for young engineers and entrepreneurs to build home-grown solutions? The choice is clear: continue with outdated policies that protect monopolies, stifle competition and leave the poor disconnected, or unlock the future by welcoming disruptive technologies that democratise access, spur innovation, and attract global investment. 

True empowerment doesn’t come from gatekeeping, it comes from opening doors. A restructured framework could drive real transformation, revitalise the economy and show the world that SA is open for business and belongs to all who live here. 

• Lourie is founder and editor of TechFinancials.