Cannabis cultivation has the potential to help Africa advance in more ways than one, and with increasing legalisation across the world, the continent may unlock a new revenue stream.
Africa is finally emerging as a key component in the cannabis industry at an amazing rate. It is estimated that the legal marijuana sphere may be worth more than USD 7.1 bn (roughly 11 billion rands) by 2023 if legislation is implemented fully. Is this an opportunity for Africa to join other countries across the world in cannabis cultivation, business and conversation?
Cannabis is nothing new to African farms, it is estimated that around 38,000 tonnes are already grown across the nation regardless of the fact that it is still illegal in many parts of Africa. A number of impoverished areas have turned to cultivating it due to the lack of employment opportunities and the decline in demand for tobacco. According to Prohibition Partners’ African Cannabis Report published in March 2019 “Poverty could be the driving force of cannabis legalisation in the region. A decline in demand for key cash crops, such as tobacco, is pushing the region’s governments to look for alternative income streams. Given that cannabis is grown illegally in large quantities across the African continent, full legislation and regulation could unlock the income potential for many African countries, particularly the leading tobacco growers Zimbabwe and Malawi.”
Without a doubt, companies looking to create or expand their cultivation operations would be making the right moves to consider Africa as a base. Africa can offer low-cost land, known to be ideal for cultivation, as well as a large labour force. With that being said, there will be obstacles along the way, as cannabis is not legal across the continent. The current legal framework has been categorised by Prohibition Partners’ report into 3 main tiers:
Tier 1 – Leading the Charge
Countries that fall into Tier 1 show signs of moving forward with significant changes to the laws and policies on medical and/or recreational cannabis. In September 2018, the world saw South Africa become the third African country to legalise cannabis after Lesotho (who, in June 2017, legalised cannabis cultivation for medical purposes) and Zimbabwe (which legalised cannabis for research and medical purposes in April 2018).
Within South Africa, the changes in legislation will stand for 24 months while the constitution is amended. This means that criminal punishment has been lifted, but the local market is not actually regulated.
Tier 2 – Ready to Strike
Tier 2 countries and regional authorities are those which have active, ongoing reviews of medical and/or recreational cannabis laws and regulations. They may head towards decriminalisation in the near future. There are ongoing campaigns towards legality in Malawi, Morocco, Ghana and eSwatini. Kenya is hot on the heels of Lesotho and South Africa too; there have been several petitions in the Kenyan Parliament requesting legalisation.
In Egypt, a draft law was proposed in October 2018, aiming to decriminalise cannabis. In 2015, Egypt’s Tobacco Merchants Association “submitted a proposal to the cabinet in order to legalise the trade and use of hash” (a form of cannabis), arguing that the legislation would “reduce the state budget deficit within a few years through imposing taxes”. However, with the political context in Egypt, one shouldn’t hold their breath.
Tier 3 – Not Quite There Yet
Tier 3 countries have characteristics that make it unlikely that there will be much, if any, liberalisation of marijuana in the short term. In March, 2017, Zambia seemed to be well poised to open for legislation on the use of medical cannabis, but the change never came.
There has not been any change in this, even though Zambian law has a provision for medical cannabis. Until an agreement can be reached, all cannabis use is illegal and subject to harsh punishment.
In April 2019 the South African Health Products Regulatory Authority (SAHPRA) announced their intention to issue cannabis cultivation licences for medicinal purposes. Guidelines were published in 2017 on the cultivation of cannabis for medicinal purposes, stating that “Cannabis-containing products intended for medicinal purposes may thus be made available, in exceptional circumstances, to specific patients under medical supervision. Authorisation is dependent on the submission of an appropriate dosage regimen, an acceptable justification for the proposed use, and regular reporting to the MCC.”
The statement made in April added to the foundations of this with the document intended to “provide the legal framework for the cultivation and processing of cannabis as a herbal starting material for the production of registered medicines.”
A license for the cultivation of medicinal marijuana will remain valid for five years. All of the sites wanting to cultivate cannabis will need to adhere to the standards as laid down in “Guide to Good Manufacturing Practices for Medicines in South Africa.””
Big things to Come
It is without a doubt that more African countries will follow in the footsteps of those who have already embraced legalisation and decriminalisation. With more entities jumping on the bandwagon, Africa may soon become a powerhouse in the cannabis industry.