South Africa is said to halt Starlink talks as US tensions escalate

Talks to license Starlink in South Africa have reportedly stalled over tensions with the Donald Trump administration in the US.

Presidential spokesman Vincent Ngwenya

Talks over licensing SpaceX’s Starlink service in South Africa have stalled over the country’s tensions with the Donald Trump administration in the US.

This is according to a recent report in Bloomberg News (paywall), which said that “negotiators plan to wait until the dispute between the US and South Africa calms down, with the intention to return to a possible deal at a later stage”, Bloomberg reported, citing unnamed sources “familiar with the matter”.

SpaceX, which is controlled by US billionaire and Trump ally Elon Musk, has for some time been seeking a licence to operate in South Africa. However, the process has been delayed over a request by SpaceX for “equity equivalents”, in terms of which it would not be required to sell a 30% stake in its South African operation but rather to make investments in other ways that advance South Africa’s programme of black economic empowerment.

Last year, communications minister Solly Malatsi asked Icasa, the communications regulator which is ultimately responsible for licensing Starlink in South Africa, to consider revising the regulations so that equity equivalents are permitted in the licensing process, particularly to ensure foreign investors are not chased away before they even commit to invest in the country.

Malatsi has repeatedly said his request to Icasa is not intended to aid Starlink in particular, but to encourage greater foreign direct investment across the sector, in line with the equity equivalence programmes allowed in other industries.

SpaceX recently withdrew from Icasa’s public hearings this month into the proposed new licensing framework for satellite services in South Africa. It had been scheduled to make a presentation to Icasa earlier this month but withdrew its participation at the last minute.

Tensions

The withdrawal by SpaceX followed a post by Musk on his social media platform X that asked President Cyril Ramaphosa why the country had what he called “openly racist ownership laws”.

Tensions between the parties now appear to be escalating further, with President Cyril Ramaphosa’s spokesman, Vincent Ngwenya, reportedly telling Bloomberg News that South Africa would not pursue an investment by Starlink at all costs.

“If a leading business figure like Elon Musk harbours the kind of unprogressive, racist views that we’ve witnessed and the peddling of lies that we’ve been confronted with, then we’re not going to pursue having his investments,” Magwenya reportedly said.

Why do you have openly racist ownership laws? https://t.co/tHWVsmB04F

— Elon Musk (@elonmusk) February 3, 2025

In its written submission to Icasa ahead of this week’s public hearings, SpaceX told the regulator that it ought to rethink the rules requiring 30% shareholding by “historically disadvantaged” groups, TechCentral first reported earlier this month.

“Many foreign satellite operators, particularly those with direct-to-consumer business models, have global policies that prevent local shareholding, thus excluding them from the South African market. This holds true even when these operators are willing to comply with B-BBEE requirements and invest in initiatives that directly benefit the target communities,” the submission said, referencing the empowerment rules in the licensing process.

Elon Musk

“By aligning the licensing and ownership regulations with the ICT sector code – which recognises equity equivalent programmes as an alternative to local shareholding – Icasa could remove a significant barrier to foreign satellite operators. This would not only increase foreign investment in South Africa but would also create broader industry benefits, supporting innovation, competition and long-term growth,” SpaceX said.