I have noticed that some international coverage of the cannabis industry is no longer with the excitement we used to read a few years ago. For example, on January 1, 2025, The Economist magazine ran an article with the headline “America’s marijuana industry is wilting“.
The recent surge in investment was partly due to politicians’ promises to decriminalize and reform the cannabis industry in the U.S. and other parts of the world when they were elected into public office.
But when they finally get into office, the regulations do not change much—at least, that is the American cannabis story. In addition to unclear regulations, competition from the illicit trade remains a challenge, negatively affecting the operations of formal businesses. This is partly because while President Trump has promised reforms in this industry, the negative headlines persist.
But the cannabis industry is not only seeing negative coverage in the U.S. In Europe, there is some negativity about this plant. For example, on December 29, the Financial Times ran an article titled “Giorgia Meloni cracks down on Mussolini’s crop: hemp“. The article stated that:
“Italy’s fascist dictator Benito Mussolini promoted the cultivation of hemp to reduce his nation’s dependence on imported rope and textiles before and during the Second World War.
But Prime Minister Giorgia Meloni’s Brothers of Italy party — whose origins lie in the postwar, neo-fascist movement founded by Mussolini’s surviving loyalists — now looks set to uproot an Italian hemp revival in its bid to crack down on recreational drug use.
Outraged by the proliferation of cannabis shops, Meloni’s government is moving to ban the production, processing, transport or trade of any varieties of cannabis flowers, including those from non-psychotropic, industrial hemp.”
For many in South Africa working on the Cannabis and Hemp Master Plans, these global developments are worth monitoring. The goal is to learn from the experience of these countries and enhance the South African regulatory path.
Yes, we have been slow in providing a new and clear regulatory path for this plant, and the licensing price has been somewhat prohibitive for some people.
What is often puzzling for me in South Africa is the proliferation of cannabis shops and various products that retailers place on shelves. Do people have clear regulations or licenses to put up all these stores?
(Hallo Ntate’Ramasodi, DG of the Department of Agriculture 😊. I think it’s time for us to look closely at these products in stores.)
To be clear, I am broadly supportive of the cannabis industry, but the regulations must be followed, mainly when people sell things all over shopping malls and fuel stations.
When we finally progress with regulations, I still believe that cannabis could be a catalyst for revitalizing rural communities that are economically marginalized and excluded from the agriculture value chains. It could also create opportunities for cannatourism, especially in rural Eastern Cape, KwaZulu-Natal, and Limpopo.
South Africa still can build a competitive edge in the cannabis industry even though countries such as Lesotho are the first movers. Lesotho is building its cannabis economy on the back of low-cost labour, water abundance, relatively affordable electricity and high altitude, which reduces costs associated with pest management, thereby positioning the country as a key supplier of an organic variety of cannabis.
South Africa’s competitive advantage could be built on the back of a transparent and predictable regulatory framework, an open investment regime, strong research and development support, knowledge networks that bring together university researchers, centres of excellence, and other industry players; product quality and standards authority; and low-cost licensing regime.
However, we need to consider practical ways to ensure that production and value chains don’t mainly develop in areas that have always been the leading agricultural zones and urban areas with better access to investment.
The communities of the Mpondoland region of the Eastern Cape have been growing this plant in the shadows of the law for many years and should benefit from its liberalization. But does the government have a clear plan for mobilizing investment and value chain development in these regions?
The Eastern Cape, KwaZulu-Natal, and Limpopo provincial agricultural departments should lead and lobby their national colleagues to refine and craft the regulation to encourage investment in these provinces.
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