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Since 1994, Multi-National Corporations (MNCs) operating in post-Apartheid South Africa have encountered exciting economic opportunities in a democratic country eager for foreign direct investment (FDI). They also discovered a country that was reconciling with the world after years of isolation, thus offering great opportunities to expand their operations elsewhere in Africa. But while the booming telecommunications market opened doors for new growth in SouthAfrica and beyond, the new democracy also placed regulations aimed at advancing the goal of racial and socioeconomic transformation on all companies operating in the country. With the liberalization of mobile markets across Africa, investment opportunities for fast-moving local and international telecommunication companies have also opened up. This growth in telephony has been largely fuelled by mobile cellular communications firms, as well as foreign capital’s drive to tap into new cellular markets. In 2003, revenues in the African mobile communications sector broke the US$10-billion barrier, with profits estimated at more than US$1 billion. (ITU 2004) The remarkable growth of telecommunications in the region has generated immense benefits for the operators (such as South Africa’s MTN, France’s Orange, Middle East’s Celtel) and their major international suppliers of technology (such as Sweden’s Ericsson, Germany’s Siemens and China’s Hua Wei). Key issues that confront the expansion of businesses from post-Apartheid South Africa are, firstly, the kind of impact South Africa’s transformation is having in Africa through the expansion of foreign MNCs, and secondly, what can be learnt from this renewed economic engagement. Focusing on a single case study, this paper examines the way that the African expansion of Ericsson, a Swedish telecommunications multinational, has been shaped by post-Apartheid transformation imperatives in South Africa. Using SouthAfrica as a regional hub, Ericsson has expanded from SouthAfrica into the African telecommunications market. I chose to highlight this firm for several reasons: its major global market share as telecommunications infrastructure provider; its return to post-Apartheid South Africa after being forced to leave in the 1960s; its position as the leading provider of infrastructure for the South African – now PanAfrican – operator, MTN; and its fast-growing market share in the continent. It is my contention here that the story of Ericsson in post-Apartheid South Africa is illustrative of how MNCs are responding to South Africa’s Broad-Based Black Economic Empowerment (BBBEE) strategy. The BBBEE objectives that characterize the postApartheid transition have affected the way this multinational operates in the continent. By looking at Ericsson’s regional growth in post-Apartheid South Africa, my aim is 1

Transnational Telecommunications Capital Expanding From South Africa into Africa: Adapting to African Growth and South African Transformation Demands