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The Future of Cannabis in Africa
It all started with a landmark court ruling in 2018. This ruling decriminalized the private use, possession and growing of cannabis.
Earlier this year during his State of The Nation Address, President Cyril Ramaphosa said “South Africa should tap into the global multi-billion-dollar medical hemp and cannabis industry”, which he said had the potential to create 130,000 much-needed jobs. This may be good news for commercial companies but traditional growers in the Eastern Cape feel left behind. The cost of getting a license to grow cannabis is just too expensive for most.
The Rural Trade
For many generations, people in South Africa’s Eastern Cape have made a living growing cannabis. You might think that as the country moves to legalize the crop, they would be first in line to benefit, but that doesn’t seem to be the case.
“Cannabis is very important to us because it’s our livelihood and source of income. Everything we get, we get it through selling cannabis. There are no jobs, our children are just sitting here with us.”, said one local farmer. While cannabis might be a way of life for this community, growing it at this scale is illegal.
There are close to a million, small-scale farmers in the Eastern Cape and KwaZulu-Natal provinces who have been growing cannabis for decades. These growers have found themselves in trouble with the law many times, but the government’s tough stance looks set to change.
“Government needs to change its approach and come up with laws that are grower-friendly and citizen-friendly. Right now, the people who have licenses [to grow cannabis] are rich people,” Mr Zueni says. “The government should be assisting the communities to grow so that they can compete with the world market. Here is a commodity growing so easily and organically. We are not jealous, the rich should also come in, but please accommodate the poorest of the poor,” Mr Zueni says.
The Government’s plan
Last year, the government revealed its master plan for the industrialisation and commercialisation of cannabis. It valued the local industry, which has largely been trading in the illegal market, at nearly $2bn (£1.6bn). It aims to make South Africa’s cannabis industry globally competitive. They also aim to produce cannabis products for the international and domestic market.
Key to the roll-out is the Cannabis for Private Purposes Bill, set to be signed during the 2022-23 financial year, which provides rules and guidelines for consumers and those wanting to grow cannabis in their own homes. It would also legalize the cultivation of hemp and cannabis for medicinal purposes, opening up the industry for huge investment and growth. It is also expected to clear up legal grey areas and therefore provide prospective investors with clarity on the future of the South African cannabis market.
“Although much still remains unclear, it seems the government is committed to opening up the industry, because the economic opportunities are too enticing to ignore”. Currently, even though private use has been decriminalised, it is still illegal to buy and sell cannabis and other cannabis products. However, judging from the many shops selling cannabis products around the country, authorities are already choosing to turn a blind eye.
The African and Global Market
“Adding to this legal minefield is that it is legal for private companies to grow and export medicinal cannabis to other countries”. One company seeking to capitalise on medicinal cannabis is Labat Africa Group, The JSE-listed company who recently acquired Eastern Cape cannabis grower Sweetwater Aquaponics.
It has also been listed in Frankfurt, because “Germany is the single largest market in Europe for medicinal cannabis distribution. The opportunities for distribution in Europe are very big. In addition to that, across borders, in Africa alone, there is a proposition that we have consolidated across a number of different countries all the way from Kenya, to Zambia to Uganda, Rwanda, Tanzania, as well as in Zimbabwe.” Legal cannabis trade on the continent is set to rise to $7bn as regulation and market conditions improve, says London-based industry analyst Prohibition Partners.
It says Africa’s top producers by 2023 will be Nigeria with $3.7bn, South Africa $1.7bn, Morocco $900m, Lesotho $90m and Zimbabwe $80m. Considering South Africa’s slow economic growth and high unemployment rate, capitalizing on the cannabis industry could reap big rewards.
The Pondoland area was synonymous with providing cannabis throughout South Africa. However, changes in the law had a negative impact on these farmers. It meant anyone could now grow and consume their own cannabis, so they no longer had a market for a crop that see to be very lucrative. Even growing cannabis to export is not feasible for small-scale farmers, because the cost is too great. It requires a licence from the South African Health Products Regulatory Authority (SAHPRA) which costs about $1,465. Apart from the licence fee, to set up a medicinal cannabis facility you need about $182,000 to $304 000. This is unattainable for most traditional growers. However, there is some promising news for the Eastern Cape farmers. The Pondoland or Landrace strain of the plant, which grows abundantly in the area, has shown encouraging results in treating breast cancer.
“The Congress of South African Trade Unions (Cosatu) says it supports the legalisation of cannabis for private, commercial and medical use in South Africa. Presenting its submission on the Cannabis for Private Purposes Bill to parliament on Tuesday (24 May), the country’s largest trade federation is one of a number of parties scheduled to give submissions on the updated bill.”
The Proposed Bill
While the main focus of the bill remains on the private use of cannabis, parliament has extended the subject of the bill to:
- Provide for commercial activities in respect of recreational cannabis;
- Provide for the cultivation, possession and supply of cannabis plants and cannabis by organisations for religious and cultural purposes on behalf of their members; and
- Respect the right to privacy of an adult person to use cannabis for palliation or medication.
While Cosatu said it broadly supports the objectives of the bill, it highlighted that a lot more work still needs to be done on the draft bill. They claim it is ‘unrealistically bureaucratic and cumbersome’ in some regards. They added that there are elements of the bill that are still too restrictive and do not go far enough in decriminalising cannabis use in the country. They pointed specifically to the use of cannabis for religious purposes and the additional regulations placed on monitoring people who use cannabis.
The original draft bill outlines possession rules for cannabis users at home and people who wish to cultivate the plant. It also introduces new offences and provisions for people who previously received a criminal record for cannabis possession.
The bill states that an adult person may for personal use:
- Possess the prescribed quantity of cannabis plant cultivation material;
- Cultivate the prescribed quantity of cannabis plants in a private place;
- Possess in private the prescribed quantity of cannabis in a public place;
- Possess the prescribed quantity of cannabis in a private place;
- Possess in private the prescribed quantity of cannabis plants in a public place.
“The bill defines a ‘private place’ as any place, including a building, house, room, shed, hut, tent, mobile home, caravan, boat or land or any portion thereof, to which the public does not have access as of right.”
The draft legislation also states that an adult person may, without the exchange of remuneration provide to, or obtain from, another adult person, for personal use the prescribed quantity of:
- Cannabis plant cultivation material;
- Cannabis plants;
Watch the guys from Marijuana Sa discuss the legal future of cannabis in SA with Paul Michael from Cullinan & Associates Law Firm here. Paul Michael was kind enough to share some information on the Trail of the Plant Two, basically Cannabis is going back to Court and a legal team will be demanding the right for lawful trade of cannabis.
Watch footage from the recent nationwide mass action gatherings here.
Read more about Fields of Green’s legal fight in Trial of The Plant and donate to their cause here.
The Grow Club Model and Recent THC Case
The High court agrees there’s not much difference between a cannabis dealer and a grow club. It says it’s not for the courts to decide on legality of grow clubs, which the believe have been set up to sidestep the Drugs Act.
The Grow Club was based on a business model whereby a person or entity leases out land, equipment and gardening services and therefore grows on behalf of its clients – plant material, including cannabis; and does not own or provide its clients with, cannabis, cannabis seedlings or feminised cannabis seeds.
In the wake of the landmark Prince ruling in the Constitutional Court on the 18th of September 2018, it was found that it was unconstitutional for the state to criminalise the possession, use or cultivation of cannabis by adults for personal consumption in their own homes and “properly designated places”. Since then, cannabis clubs have mushroomed across the country.
“The State argued that the club did not operate in a private space and therefore, fell afoul of the law. The judge said the applicants and their customers are not prevented from using and or cultivating cannabis — they are merely prevented from outsourcing that right. Operating a grow club is therefore still deemed to be a criminal act in terms of the Drug Trafficking Act and conviction can lead to imprisonment.”
However, it is not the end of the road as an appeal should be coming soon.
Watch the guys from Marijuana SA break down the trial and legal points in this interesting video.
Read more here:
- South Africa legalises cannabis use
- Arrests over cannabis plants at president’s office
- Health risks of recreational cannabis
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