While it notes the recent publication of draft policy directives in the ICT sector, the African National Congress (ANC) says it remains committed to defending transformation in the sector.
Last week, the Democratic Alliance’s Solly Malatsi, who serves as communications minister in the nation’s governing coalition, gazetted several policy directives. These included the contentious proposal of equity equivalent investment programmes (EEIPs) in the ICT sector, which potentially clears the way for tech billionaire Elon Musk’s Starlink to operate locally.
While Malatsi has stated the EEIP ministerial directive is not meant to “deviate” from broad-based black economic empowerment (B-BBEE), many view it as SA bending its transformation rules to enable the licensing of the Starlink satellite internet service.
The minister proposed the Independent Communications Authority of South Africa (ICASA) review the role of EEIPs in the ICT sector as a mechanism to accelerate broadband access.
Regulations do not currently allow companies that can contribute to SA’s transformation goals in ways other than traditional ownership, to qualify for individual licences under the Electronic Communications Act (ECA). Licence approval requires that a company must be 30% owned by historically disadvantaged groups.
In a statement, ANC national spokesperson Mahlengi Bhengu-Motsiri says the ICT sector policy developments mark an important phase in shaping a digital future that must be inclusive, transformative and people-centred.
“The ANC will actively participate in the forthcoming consultative processes to ensure the transformation agenda is upheld and that the economic inclusion of historically disadvantaged communities is comprehensive, meaningful and irreversible.
“We further note that these are not new ideas; they are part of a consistent ANC-led transformation agenda to include historically excluded South Africans in the digital economy. EEIP enables multinational companies that cannot sell direct equity to invest in enterprise development, black industrialists, youth and women in ICT, skills training and innovation.”
According to Bhengu-Motsiri, if implemented equitably, satellite broadband will bring “life-changing” benefits to rural, remote and underserved communities.
However, she says the ANC emphasises that digital expansion must be anchored in transformation.
“We reiterate our support for the 30% minimum equity ownership by historically-disadvantaged persons as required by Section 9(b) of the ECA. This must include youth, womenand persons with disabilities − both as beneficiaries and participants in the ownership and operation of ICT infrastructure. Transformation must not be reduced to a tick-box exercise. It requires proactive and deliberate support.
“We further emphasise the importance of ministerial concurrence and Cabinet approval in ensuring the EEIP aligns with national development objectives and avoids unintended dilution of transformation imperatives.”
Stakeholders have 30 days to comment on the draft policy direction, with the process expected to draw input from the public and various key stakeholders, including role-players in the sector.
The ANC also called on stakeholders − including government departments, regulators, the private sector and civil society − to work in partnership to shape an ICT policy environment that delivers universal access, economic justice and shared prosperity.
“The current phase of reform is a crucial opportunity for thoroughgoing empowerment, and we will engage with clarity, commitment and vigilance to ensure no South African is left behind.”
Uplift and transform
Meanwhile, the Progressive Blacks in ICT (PBICT) lobby group has thrown its support behind the proposed policy directive, saying it is something it has been advocating for since 2017, starting from the time of former communications minister Dr Siyabonga Cwele.
PBICT president Leon Rolls explains: “We support the upliftment and have been waiting for it; we won’t allow popcorn politicians and social media trolls to dilute this for votes and likes. The directive gives ICASA the mandate to open the application for individual licences. ICASA, on the other hand, has six months to explore ways of achieving this, while maintaining the national interest of transformation.
“We support the minister’s thinking that allows for another option in the transformation agenda. Instead of any new international or non-B-BBEE-compliant entity using window dressing, such as appointing a garden boy as a director and giving them a ghost 30% share, there must be another genuine empowerment programme.”
According to Rolls, the PBICT proposes that Broadband Infraco should be the landing partner, backhaul partner and transformation programme partner for any international player seeking a licence to operate in this country, and that it should be prohibited from selling 30% of its stake to a B-BBEE partner.
“The 30% equity share must be evaluated, and the funds must be allocated towards Broadband Infraco programmes, such as SA Connect and Broadband Access Funds. We have seen these programmes empower 100 of our SMMEs, create jobs and connect thousands of people across the country. We have trained our SMMEs long enough; it is now time to implement.
“We support the entry of new competition into the space, especially VSAT services like Starlink and China’s Chang Guang Satellite Technology.
“The legislation must direct them to use Broadband Infraco as the landing partner; this is how we secure the transformation agenda. Broadband Infraco is the bridge for the digital divide between the haves and have-nots.”
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