Portugal Cannabis Revolution May Blow Africa's Export Aspirations Out the Water
South Africa's new Country Investment Strategy (CIS) has identified the export of high quality medical cannabis as the driver of the new cannabis economy. Industrial Cannabis is given the grand title of Strategic Investment Frontier Number Four. Oh dear. Let's call it Strategic Investment Mistake Number One. Strategic Investment Frontier Number Four should have been the opening up of the local cannabis market.
The first driver of cannabis reform should be the opening up of the commercial trade of cannabis and related products in the domestic market.
The private sector has pointed the obvious economic logic of this to the Government time and time and time again: a succesful export industry is best built on a thriving local market that enables the development of new products and brands that can be incubated before exposed to the world stage. It takes time to develop an international reputation.
Three years ago, South Africa - and the rest of the continent, may have been in the running for being a player in the European medical cannabis market. Just like we had the potential to be a world leader in hemp 25 years ago. But Government aversion to reality and policy paralysis has let those opportunities slip by.
Today the situation is radically different. Legalization of medical cannabis in Europe is unfolding far more rapidly than the industry anticipated. With the prospect of Germany introducing adult-use consumption within the next two years and medicinal cannabis patient numbers climbing through the roof, the foundation for a multi-billion dollar high quality, high-THC cannabis is being laid in Europe.
That should be good news for Africa. But in the dynamic world of canna-geopolitics, we are once again in danger of being marginalized. Portugal has literally pipped us to the post.
Two recent comments from global industry leaders have cast a shadow over South Africa's cannabis strategy, and the unfortunate Akanda boardroom blow-outhas tarnished Africa's reputation as a place where one can do business.
These comments point to Portugal's rising prominence in global cannabis.
Akanda's CEO, Tej Virk, rightfully miffed at the twilight actions of former executive chair Louise Mojela, and looking to secure a foothold in the German market, said the Nasdaq-listed multinational was committed to its Lesotho investment. But he said, it made more sense to service the European market from the group's Portuguese subsididiary, Holigen, rather than Africa.
"With Holigen, Akanda believes it has more than sufficient capacity to produce premium quality indoor, outdoor and greenhouse medical cannabis within the European Union as the market matures. Additionally, with shifting market dynamics, we have found higher demand from German and UK customers for product produced in Portugal than Lesotho due to evolving EU regulations”.
Prohibition Partners' founder Stephen Murphy told Canna Reporter on 14 August 2022:
“There is enough cannabis being grown in Portugal that it could supply all of Europe. There is already oversupply in Portugal”
So where does this leave southern Africa? A bit on the margins, as usual. What our cannabis policy commissars should be doing with serious urgency is to relook at their assumptions underlying cannabis reform. The country's cannabis economy will be dead in the water if it is based only on exports, and by neglecting the local market, Government continues to criminalize the very people it professes to want to help.
And besides that, there's an underlying hypocrisy at stake. What is it about Africa that it wants to export the benefits of a natural resource without allowing Africans the same benefit? Why is high-THC cannabis good for Europe and not for us?
South Africa should be leading the way in showing the rest of the continent how we can use the power of the plant to transform the lives of millions of people, particularly in rural areas. However, until such time as the Government accepts the reality of the existing illegal cannabis economy and puts in place a firm plan to bring it into the mainstream, it risks igniting the laws of unintended consequences and the prospect of a lose-lose situation.
Cannabis is emerging as the new colonialism in the African vacuum. It exposes our policy makers as being cut-and-paste puppets who are quick to satisfy the needs of big business at the expense of our people. We should stop looking to Europe as our salvation and be bold enough to believe in ourselves.
Full adult-use legalization is the only solution. All the evidence is available to craft a new cannabis law that allows for the commercial trade in cannabis and related products with all the harms-reduction measures in place. And as a matter of urgency, cannabis-related arrests must stop!