‘Government dragging its feet’
Labat Africa CEO Brian van Rooyen says the potential of a South African cannabis economy is “huge” and is set to “explode” – if only Government would get its house in order.
“The government has signalled it wants us to grow the local cannabis industry but we can only plant, cultivate and export. It makes no sense. Premiers and finance ministers go on about the huge contribution to the economy cannabis can make, and yes, it’s all true.
“So the sooner they get the legislative issues dealt with the better.
“I don’t know why they’re dragging their feet. But I think they’re moving on it now. There’s been a lot of pressure from community-based groups and political parties. There’s a lot happening to make sure government moves on the regulatory side.”
When that happens he expects the market for locally manufactured cannabis products to explode in SA and on the African continent. “It’s going to be huge”, he said.
“When regulatory approval is given we’ll have first-mover advantage. We won’t have to start from scratch.”
Labat champing at the bit to get product into local pharmacies
In the interview van Rooyen said European and Australian companies had expressed interest in Labat and that it had established international partnerships with more in the pipeline.
“A lot of international companies have approached us recently to form partnerships.”
Van Rooyen said Labat was champing at the bit to supply local pharmaceutical companies with self-processed and -manufactured CBD products but, by law, could only supply them with products processed and manufactured overseas.
“So although we’re considered the go-to company, the only thing we can do now is compete in the retail space with the likes of Clicks, Dis-Chem and Pick n Pay, which import cannabis-related lifestyle products.”
Labat recently bought 100% of Miami-based company Echo Life, which has a range of CBD lifestyle products such as energy bars, energy drinks, beauty creams and CBD smokables, which Labat is selling in its online and CannAfrica stores.
Van Rooyen told Barron he was about to sign an agreement with one of the major pharmaceutical chains, but was not at liberty to yet name, to be a distribution outlet for these products.
The smokables, which contain CBD oils but no tobacco or nicotine, are particularly popular, he said. “We brought in 5,000 packs, they were all sold. Brought in another 7,500 two weeks ago and they’re almost all sold.”
Van Rooyen said Labat intended to export its newly acquired range of CBD lifestyle products from Echo Life to European and other markets as well, but had not begun to yet because its hands are full in the South African market.
Because of the high quality of South African cannabis, van Rooyen said he expected good international demand, especially with the legalization wave that’s started in Europe. He said international investors were interested in Labat Africa but didn’t want to necessarily put money into South Africa.
“They said they’d be very keen to invest in Labat if we had a secondary listing on a European exchange” he said.
“The Frankfurt listing will allow us to accelerate our cannabis goals in the European market and offer South Africa and international investors exposure to high-growth investments in the cannabis value chain.”