Trade, Industry and Competition Minister Parks Tau is the man Cyril Ramaphosa has appointed to spearhead the commercialization of cannabis. The DTIC is the lead department driving the National Cannabis Master Plan and has put a draft commercialization document out for public comment. This is Minister Tau’s foreword to the document:

Regulation the Best Tool for Harms Reduction

While the more than a century long prohibition of cannabis has impacted the scientific community comprehensively and exhaustively researching this plant, studies and control tests do provide strong evidence that there are numerous medical benefits to using this plant and that its recreational use for adults is a better social policy apparatus as it allows for policymakers to regulate.

Such will assist in ensuring an end to an illicit market; providing better oversight and minimise adolescent access and protect adult consumers from harms as a result of illegal and illicit market.

Furthermore, cannabis, as a product for adult use, has also been found to be less harmful than alcohol, tobacco and opioids.

For a nation-state, there is additional socio-economic benefits of legalisation of cannabis, as there exist a net-positive economic growth opportunity of incorporating the cannabis market into the formal economy. In many countries, while the criminal penalties or imprisonment for personal use and possession of cannabis was removed, they left the supply of cannabis to the illicit market, fuelling a crime-prone underbelly and networks of individuals operating outside the realm of ethical and moral behaviour.

With the growing public support and judiciaries overturning legislation that criminalises cannabis, a new dawn is emerging that is showing the way for a cannabis global market coming to existence that will uphold democratic principles such as human rights and better application of science and research into the sale and use of cannabis – both medically and recreationally.

Legalization Will Have a Net Positive Impact on the Economy

On 18 September 2018, Constitutional Court of South Africa ruled that South Africans can now use cannabis in the privacy of their own homes, the judgment that has provided impetus to recognise and open new doors for commercialisation of cannabis in South Africa. Furthermore, with our economy facing sluggish growth and society facing the impacts of COVID-19, commercialisation of cannabis may have a net-positive impact on our country by potentially creating new jobs.

The South African economy has been in steady decline for number of years according to various reports from Statistics SA, with economy slumping by 7,0% in 2020. This state of affairs is attributed to various factors like unreliable energy supply, poor transport systems, declining investments in infrastructure. The economic challenges resulted in increased liquidations and bankruptcies of many companies including SMMEs.

The poor state of the economy had also resulted in reduction in government revenues and subsequent increases in poverty and high unemployment levels. Geopolitics such as the Brexit matter also further compounded economic problems for South Africa as new South Africa (SACU / SADC) – UK trade and development agreement was required to be negotiated, signed and ratified by 2019.

The emergence of a new bipolar world order, with the US and China the as protagonists, has also slowed down global economic growth. Both of these countries are major export destinations for South African products.

In line with the statement made by the President of the Republic of South Africa and as a direct outflow of the NCMP, Mr Cyril Ramaphosa, in his State of the Nation Address (SONA) on 11 April 2022 on the commercialisation and industrialisation of the cannabis sector, this draft policy forms the basis for discussion towards commercialisation and industrialisation of cannabis for South Africa.

Regulatory System Will Be Streamlined

The cannabis, together with the hemp sector, has the potential to create more than 130,000 new jobs in the economy as a whole from cultivation, manufacturing and retailing. For that reason, South Africa is therefore streamlining the regulatory processes so that the hemp and cannabis sector can thrive like it is in other countries such as Lesotho. It is government’s intention to review the policy and regulatory framework for industrial hemp

and cannabis to realise the huge potential for investment and job creation. The cannabis and hemp sector has been looked at by government as a broad and diverse range of South Africans that fundamental reforms are needed to revive economic growth

For this reason, the Department of Trade, Industry and Competition (the dtic) hereby introduces for discussion a draft National Policy on the Commercialisation of Hemp and Cannabis in South Africa. This is also done in line with the draft National Cannabis MasterPlan for South Africa which requires the dtic to develop a policy and legislation on the commercialisation of hemp and cannabis for South Africa.

As a leading department responsible for trade or commercial issues within the South African government, it is my hope and that of my department, stakeholders in the cannabis industry as well as other leading departments having interest in the cannabis sector that the draft policy will receive due consideration and support among all.

Mr Parks Tau, MP

Minister of Trade Industry and Competition

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