Are José Manuel Entrecanales (Entrecanales), Amancio Ortega (Inditex), Ignacio Sánchez Galán (Iberdrola), Ernesto Antolín (Grupo Antolín), or Francisco Fernández-Cosentino (Cosentino) black?
The answer to that question is obvious, but it raises another issue: if the companies of these Spanish executives and entrepreneurs are present in South Africa, why did the world's richest man, Elon Musk, tweet on March 7 that his satellite communication network Starlink "is not authorized to operate in South Africa because I am not black"?
Exactly a month earlier, the President of the United States, Donald Trump, had issued an executive order (somewhat similar to a Spanish royal decree) ordering the suspension of all development and humanitarian aid to South Africa due to the "immoral and unjust practices" of that country against the white minority, which accounts for around 7% of the population. In the document, Trump thus broke with his policy of expelling refugees and announced that the U.S. would welcome white South Africans. All of this was part of a crisis that culminated on Wednesday in the ambush at the White House of the U.S. President by his South African counterpart, Cyril Ramaphosa, a situation that resembled, in form and substance, the one suffered by Ukrainian Volodymyr Zelensky on February 28.
The official U.S. delegation at the meeting included Musk, who holds U.S. and South African nationality, as well as that of another country that has had a tough clash with Donald Trump: Canada. The entrepreneur, as is his custom, was the only person not wearing a suit and tie, but instead wearing his black cap with the slogan Make America Great Again (MAGA) and a T-shirt of the same color that said "Technical Support," as if he were an employee of the White House's IT services. Trump reportedly prohibited Musk from speaking, according to U.S. media.
Musk's confrontation with the South African government seems to have little to do with race and much to do with money. The key lies in the Black Economic Empowerment (BEE) strategy, launched after the end of the racist apartheid regime by Thabo Mbeki, then right-hand man of the first black President in the country's history, Nelson Mandela, and later his successor.
Musk does not want Starlink, or any of his companies, to be subject to BEE, which establishes a points system to promote three forms of designated groups, namely, blacks, mixed-race, Indians, women, and disabled individuals (but not immigrants, although these are predominantly black from other African countries). The first is the hiring of individuals from these groups. The second is their entry into the company's management. The third is the only one with a defined target: 50% of the capital of companies of a certain size must be in the hands of the designated groups.
This is antithetical to Musk, who runs his companies alone, with completely irrelevant boards of directors, and does not allow his employees to join unions. The entrepreneur always seeks absolute freedom, whether in his companies, with his officially recognized 14 children, or, according to a Wall Street Journal investigation, with the several dozen more offspring he has had through artificial insemination with other women who have previously signed a contract with the owner of Tesla, SpaceX, X, Neuralink, and The Boring Company.
But there is also a more serious problem: if Musk yields in South Africa, he will have set a precedent, and other developing countries where the network is entering will demand the same. Musk does not want to hear about that because he knows that this satellite telecommunications technology, also being imitated by Amazon and China, will be crucial for internet development in the developing world.
Africa, Asia, and parts of Latin America went from having no phones to having only mobile phones - without going through landlines - thanks to this technology that allowed them to access voice services. By the same token, Kenya became a global leader in mobile financial transactions a decade and a half before the West discovered services like Bizum, Zelle, or Venmo simply because in a country without bank branches or smartphones, a telecommunications company, Safaricom, designed a system to send money like a text message.
It is likely that this dynamic will be repeated with the internet, and the 800 million people in sub-Saharan Africa and 1.55 billion in Asia who do not have internet access will eventually achieve it not through fiber optic cables or antennas but by connecting directly with satellites. And in this regard, Starlink is by far the undisputed leader.
Some also see a racist component in the dispute. Musk comes from an immensely wealthy South African family, to the extent that he went to school during the apartheid era in a Rolls Royce. In addition to Trump, two of Trump's advisors who have come from Silicon Valley were raised in South Africa. Peter Thiel, the main advocate of a technodictatorship and the second-largest shareholder of SpaceX after Musk, spent his childhood and adolescence in the 1970s in Namibia, then occupied by South Africa. His father was an engineer in a uranium mine. At that time, all miners were black and operated under a regime where blacks were literally forced to work under the Master and Servant Act, which legalized physical violence against workers. David Sacks, who advises Trump on cryptocurrencies, also grew up in South Africa.
Musk can minimize the first two requirements - staff and executives - but the problem is that this would give Starlink very few points in the BEE ranking. Without a high score, SpaceX would not obtain the state license to operate in the country.
Other entrepreneurs, however, have not been as meticulous. The large South African companies, which were controlled by whites when apartheid fell, have hired more designated groups and have given executive positions to individuals of these races to whom they have barely granted power.
As for the 50% of the capital, they have given it for free to representatives of these groups, who will pay for it by waiving dividends until the deducted amount reaches the sale price. This easily translates into decades during which control of the companies remains in the same hands.
However, things are more complex. Blacks (and especially the economically dynamic minority, the Indians) have established investment funds to enter the companies' capital under the BEE. In fact, the African National Congress, which has been in power since the end of apartheid in 1994, is the only political party in the world with an investment fund, Chancellor House, to participate in foreign companies, such as the subsidiary of the Japanese multinational Hitachi.
The BEE has allowed the creation of a black middle and upper class, which many see as a new oligarchy favored by the state. The best example of this is Cyril Ramaphosa, who, thanks to this regulation, has amassed a fortune of around 450 million euros by entering the capital of companies like the American McDonald's, being appointed to the board of directors of, among others, the Anglo-South African brewer SABMiller, or becoming an advisor to the British consumer goods giant Unilever. When Ramaphosa told Trump on Wednesday, "I'm sorry I can't give you a Jumbo," the American replied, "I wish I could, I would accept it," probably both were being sincere.