Johan Slabber, CEO and founder Origo
Despite its huge potential, South Africa is yet to emerge as a key player in the global cannabis industry. Origo CEO Johann Slabber says to overcome the policy paralysis and get an overall regulatory framework in place, Government should revive the National Cannabis Master Plan working groups that "disappeared without trace".
This article first appeared in Business Day on 14 May 2023.
It has been just over two months since President Cyril Ramaphosa’ s state of the nation address, in which he announced plans to accelerate the growth of the cannabis industry in SA — an intention he also expressed last year when he announced a review of the policy and regulatory framework for industrial hemp and cannabis.
Progress seemed promising as the president put together Cannabis Masterplan working groups and workstreams consisting of stakeholders from the state and private sector to create a regulatory framework.
But these groups have collapsed and disappeared without a trace, a disappointing outcome for such a promising project. We cannot afford to stall on this. In a country where over 7.8-million people are unemployed, job creation should be a priority.
The 2022 African Cannabis Report puts the value of Africa’s legal cannabis market at about $7.1bn (R137bn) across nine key African countries, including SA. According to Ramaphosa, the cannabis industry has the potential to create more than 130,000 new jobs.
The medicinal cannabis market in particular is flourishing as its benefits for the relief of symptoms in conditions such as Alzheimer’s and chronic pain are increasingly recognised and accepted.
Germany is now the largest and most developed market for treating medical conditions with cannabis products, followed closely by other European countries. These countries are looking to SA for products that meet the strict regulatory requirements imposed by foreign governments.
A national regulatory framework and cannabis plan will also benefit existing cannabis farmers, providing them with the skills and resources to grow medical-grade crops. The jobs required to make this work span multiple skill sets affecting every level of the supply chain and often require specialised training.
At the cultivation stage, crops must be grown in the right conditions, controlling temperature, soil toxins and other variables to meet regulatory requirements. The extraction of cannabinoids to make products such as oils, tinctures, edibles and concentrates also requires expertise and meticulous monitoring to meet international export standards. Once the products have been developed, specialised dispensers are needed to advise consumers on the right products for their needs.
All this needs to be overseen by compliance officers who are well versed in regulations related to the medical marijuana industry, including licensing, permits, documentation and reporting.
If SA is to become a major player in the African medical marijuana industry it is also essential that we invest in research & development to fully understand the potential of medical marijuana and develop new strains and products for export.
Some parts of the country are already realising the benefits of investing in the cannabis industry and building these skill sets. In April the Ntabankulu Local Municipality in the Eastern Cape put R80m towards the creation of a specialised agricultural college to train local farmers in the commercialisation and processing of their cannabis crops.
Last month, the Western Cape MEC for agriculture, Ivan Meyer, announced an implementation framework for integrating cannabis into the province’s agricultural sector, saying this will create over 25,000 job opportunities. Meyer estimates the industry in SA is worth R28bn. In the same month, Free State MEC Saki Mokoena allocated R5m “to plant cannabis and implement a cannabis value-adding project”.
Origo was established as a biotechnology company with a licence from the SA Health Products Regulatory Authority to cultivate, import, export and distribute cannabis and cannabis products.
Origo’s Gauteng facility will be the first bio-hub for medicinal cannabis in SA, catering for commercial-scale licensed producers and farming SMMEs nationally. It has been specifically developed to support licensed producers with market access. The objective of the programme is so unlock economic opportunities and job creation through cultivation and processing of cannabis at industrial scale.
As the country’s regulatory environment evolves, SA is poised to set the standard for effective, accessible and responsibly produced medicinal cannabis products both locally and beyond.
Focused on SA and its existing commercial and small-scale producers in alignment with the strategic approaches of government, Growing Gauteng together 2030 and the National Development Plan, our goal is to explore the potential of the emerging industry with a view to creating jobs and restoring prosperity to local communities, while stimulating the economy within the agricultural and pharmaceutical sectors.
SA was one of the first countries to decriminalise cannabis and we are yet to be seen as a key player in the global cannabis industry. We are one of the lowest cost producing countries for cannabis and we have ideal climatic conditions and growing experience. Provinces are leading the charge, but efforts need to be on a national scale to fully realise the potential of the cannabis industry, particularly when it comes to job creation.
Re-instating the Cannabis Masterplan working groups is only the first step.
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