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Justice Committee Chair Warns Against Multinationals Taking Control of SA Cannabis Industry

Parliamentary Justice Committee chairperson Bulelani “Gratitude” Magwanishe has sounded a warning against multinationals taking over the South African cannabis industry. He told MP’s on 27 August 2021 that government should not “allow the cannabis industry to slip through its fingers”.


Cannabis must avoid the mistakes of the mining industry

“Let’s not make the same mistake as with the gold and platinum scenarios where your big multi nationals will come and take everything and by the time we wake up, we have nothing. So yes consult but remember time waits for nobody” said Magwanishe, as reported by SABC .

He called on on government not to delay implementing the National Cannabis Master Plan (NCMP). This is the first time a spokesman from the Justice “cluster” has fully endorsed the NCMP and follows the tabling of a revised wording of the Cannabis for Private Purposes Bill which is to be debated by the Committee from Tuesday, 31 August 2021. 

The Portfolio Committee on Justice and Correctional Services last week held a two-day engagement with several government departments on its work around cannabis for medical and personal use.

Over the two days the Department of Agriculture, Land Reform and Rural Development (DALRRD), the Department of Trade, Industry and Competition (DTIC) and the Department of Health (DoH) each made presentations on the masterplans for the cannabis industry.


DALRRD: cannabis can create up to 25 000 new jobs

In its presentation, DALRRD said the establishment of the cannabis industry will lead to diversification of the economy and thus increase economic growth, create jobs and alleviate poverty. The potential size of the cannabis industry in South Africa is estimated at about R28 billion and could create between 10 000 to 25 000 jobs across the entire value chain.

Magwanishe said this was very important for the country in order to help the struggling economy grow again after the hammering it took because of the Covid-19 pandemic. “We see a depressed economy. We want to see a change and the benefits that this industry can bring is encouraging.

“We however want South Africans to benefit from this. We want to see real projects starting from the ground, owned by South Africans. We can partner with multinationals, but firstly our people must benefit. We do not want to see the same situation that happened in the mining sector, where now we just see empty mines and no actual development in those communities.”

According to the DALRRD, several pathways are being investigated. This includes the hemp, medical, and recreational cannabis value chain.

The committee heard that Cabinet took a decision in July 2019 that South Africa needs a national strategy to industrialise and commercialise cannabis in order to increase economic growth, create jobs and alleviate poverty. The Minister of Agriculture, Land Reform and Rural Development was appointed as the convener of this process. An inter-departmental committee was established to guide the development of the National Cannabis Master Plan (NCMP).

This committee is composed of representatives from departments of Health, Justice, DALRRD, Small Business Development, Science and Innovation, DTIC, the Presidency and the South African Police Service. Representatives of several state-owned entities and some universities were also co-opted into the committee.


Master plan scope includes hemp and cannabis

The scope of the master plan includes both hemp and marijuana. Lessons were learnt from major cannabis-producing countries, including Canada, Portugal, Uruguay, Spain, the United States, China and Mexico. Experiences from other countries on the African continent were taken into consideration. These include Nigeria, Ethiopia, Egypt, the Democratic Republic of Congo, Tanzania and Kenya. Lesotho has also started issuing licenses for medicinal cannabis.

The committee heard that South Africa already has rural communities who have cultivated and sold dagga for hundreds of years, even though it was illegal to do so. Dagga contributed to improved livelihoods at household level, as well as economic development of those communities. The dagga was sold mostly for recreational purposes in large cities and towns. There are reports that some of this product is been exported illegally out of the country.

The objectives of the plan are to increase the volumes and variety of cannabis products destined for both local and export markets, and establish and increase the capacity of South African farmers to produce dagga and hemp. The plan also aims to create opportunities for the creation of small- and medium-size enterprises across the cannabis value chain and replace imported cannabis products with locally produced products. It will also increase investments in research and technology development to support increased production, productivity and competitiveness of the industry, and establish and increase the manufacturing capacity of the South African cannabis industry. The plan will furthermore develop and maintain an effective regulatory system by strengthening law enforcement measures to deter the production, manufacture and sale of cannabis outside the legal framework.

Magwanishe said the committee will hold three days of public hearings on the matter, where it will listen to those who made written submissions on the Cannabis for Private Purpose Bill.

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