President Cyril Ramaphosa has reaffirmed South Africa’s commitment to broad-based economic transformation, emphasising that the country’s empowerment laws are practical, effective, and central to fostering inclusive and sustainable growth.
In his weekly letter to the nation, Ramaphosa highlighted that the Broad-Based Black Economic Empowerment (B-BBEE) framework and the Equity Equivalent Investment Programme (EEIP) are key to both economic redress and development.
“Amongst the most salient features of our country’s empowerment laws are their practicality, feasibility and responsiveness to economic conditions without deviating from the objective of redressing the economic injustices of exclusion of the past,” said Ramaphosa.
He explained that South Africa’s transformation agenda is guided by two complementary goals: changing the racial ownership and control of the economy, and ensuring inclusive, long-term economic growth that brings black South Africans, women, and the youth into the mainstream.
The EEIP, designed for multinational firms whose global structures may not allow equity ownership transfers, enables impactful investments in skills development, enterprise support, and innovation. Addressing misconceptions about the programme, Ramaphosa clarified:
“Some in the public space have recently sought to suggest that the EEIP represents a circumvention of B-BBEE laws -and that it is a response to the conditions of a particular company or sector.
”Neither is factually correct. Firstly, the EEIP is not new and has been in existence for a decade.”
He reaffirmed that EEIP is “firmly embedded in our laws” and comes with stringent requirements and government oversight to ensure meaningful, broad-based impact.
”The Broad-Based Black Economic Empowerment legal framework applies to all companies wishing to invest in and do business in our economy, whether they are local or foreign.”
This comes as Elon Musk’s satellite internet company, Starlink, has expressed interest in entering the South African market, despite Musk’s previous criticism of the country’s B-BBEE legislation.
Companies like Microsoft, Amazon, IBM, Samsung, and global automakers including Toyota and BMW have successfully used EEIP to fund socio-economic development, support black-owned enterprises, and advance South Africa’s digital and industrial transformation, he said.
”By way of example, last year IT giant Microsoft announced a R1,32 billion investment over ten years in skills and supplier and 4IR research and development – under the EEIP.
”These firms have leveraged the EEIP to direct investment into local development, to incubate black, youth and women-owned businesses, and to fund skills development. This has in turn assisted government in achieving a number of policy and also infrastructure goals”.
“Equity Equivalents have been proven to be a practical B-BBEE compliance tool for multinationals operating in South Africa, and we will continue to leverage them in pursuit of economic growth and job creation.”
Ramaphosa further highlighted that B-BBEE compliance should not be seen as a burden, but as an investment in the country’s future.
”Not only do we have to move away from the perception that we must make a choice between growth and transformation – we also have to shift the mindset that compliance with B-BBEE is punitive or burdensome.
“By supporting firms with compliance they are able to embrace empowerment as a meaningful investment in South African’s long-term economic stability. This is a sound strategy that recognises that a transformed South African economy is one in which their investments are safe and guaranteed.”
He also highlighted the need for South Africa to adapt to changing global economic dynamics.
“Just as our economy has evolved since our B-BBEE laws were first conceptualised, so has the playing field.”
“The emergence of new industries, whether it is digital technology, advanced manufacturing, AI or renewable energy, means South Africa must actively position itself to attract greater foreign and domestic investment in these sectors or risk being left behind.”
As the country works to strengthen competitiveness in emerging sectors, Ramaphosa reiterated that transformation remains non-negotiable.
“Our empowerment laws remain central to our goal of economic transformation in South Africa and are here to stay.”
Ramaphosa called on all sectors, business, labour, and civil society, to unite in building an inclusive economy:
“Our focus going forward must remain creating an enabling policy environment, driving key structural reforms, supporting innovation, and reducing regulatory barriers to harness the potential of emerging industries and support existing ones.”
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