Zimbabwe is offering international cannabis investors the option of owning 100% of their operations and the right to choose where in the country they would like to invest. This is a major departure from the country’s existing foreign investment regime which requires significant local shareholding in any such venture.
The Harare government has also approved the establishment of the Green Industry Fund, to promote local beneficiation, skills transfer and development of the local pharmaceutical industry.
I00% foreign ownership a ‘significant departure from previous policy’
The operational framework will be administered through the Zimbabwe Investment and Development Agency (ZIDA)’s One Stop Investment Services Centre (OSICS), according to a statement by ZIDA chief investment and corporate affairs officer
Tinotenda Kambasha on 14 May 2021, investors can have 100 percent ownership of their investments and locate their facilities anywhere in the country without prescription.
“This is a significant departure from previous policy which required investors to co-own investments in joint venture with Government or Government entities and locate their investments at state prescribed locations,” he said.
“To further assure investor safety and protection, the Government has finalised and agreed a legal instrument called the Investment Stability Agreement (‘ISA’), which gives investors added security.
ZIDA’s Kambasha: Zimbabwe very open to international cannabis investors
Cannabis investments will be protected against appropriation
The ISA outlines the guarantees offered by Government for the protection of property rights, ring fencing investments against expropriation and protect investors against change in laws. In addition, it provides a framework for monetary and fiscal incentives unique to medicinal cannabis sector.
According to ZIDA, the export retention regime is differentiated as follows:
- status unprocessed (two years);
- semi-processed (three years), and
- fully processed (four years).
Analysts expects the global medical cannabis market to grow at a compound annual growth rate (CAGR) of 15,3 percent between 2021 and 2026.
Government has also approved the establishment of the Green Industry Fund, to promote local beneficiation, skills transfer and development of the local pharmaceutical industry.
“To give effect to the investment ecosystem of medicinal cannabis growth and production in Zimbabwe, an Inter-Ministerial Committee of all the relevant stakeholders superintends this very important new industry,” said Kambasha.
“Investors are expected to install smart technology on all medicinal cannabis production premises for securit
y and monitoring purposes. All investments are administered through ZIDA’s OSISC which facilitates the licensing of all investments in medicinal cannabis.”
New framework a strong statement of intent: Zimbabwe wants cannabis investors
The framework is a result of consultation with industry and relevant stakeholder players including the Ministry of Health and Child Care, Ministry Finance and Economic Development, Ministry of Lands, Agriculture, Fisheries, Water and Rural Settlement, Ministry of Defense and War Veterans Affairs and the Cannabis Industry Association of Zimbabwe (CIAZ).
Announcing the framework, ZIDA chief executive Doug Munatsi said:
“This is the country’s strong statement of intent to nurture and grow this industry and become one of the leading players in medicinal cannabis production, fully optimizing the inherent comparative advantage Zimbabwe has in the form of skills, climate and agricultural expertise.”
Said Medicines Control Authority of Zimbabwe (MCAZ) acting director-general Richard Rukwata:
“MCAZ is very excited to be playing a strategic role in facilitating an enabling a progressive regulatory environment to encourage the growth of the medicinal cannabis industry.
“The ISA compliments Statutory Instrument 62 of 2018 (Dangerous Drugs Act) and we anticipate this will provide the comfort investors in this sector require.”
CIAZ president Peter Rhodes welcomed the initiative.
“The ISA is a welcome and genuine display of the GOZ’s desire to drive growth in the medicinal cannabis sector through providing stability and security to investors,” he said.
“CIAZ encourages its members and other players to take full advantage of the very positive steps taken by the Government to make the growth and production of medicinal cannabis competitive regionally and globally. We remain engaged with Government through ZIDA to continually improve and remain competitive.”