Opinion

Let's not be dopey about cannabis: it has huge potential to fire up the Eastern Cape economy

We must not watch from the sidelines as we did with our minerals

23 June 2019 - 00:07 By LUBABALO OSCAR MABUYANE
A cannabis shop in Krakow, Poland, advertises SA dagga seeds.
A cannabis shop in Krakow, Poland, advertises SA dagga seeds.
Image: Beata Zawrzel via Getty Images

Remarks I made recently about the need for our province to benefit from the cannabis economy not only brought things out of the bunker but showed how much public interest there is in this emerging economy.

While SA has not yet fully legalised commercial production and trading of cannabis, businesses, producers and processors in countries where this has been legalised continue to reap billions in profit, good job numbers and good tax revenue for those governments. Many countries have moved away from the narrow use of this plant for recreational purposes because it offers more medicinal and health properties than just a puff.

New industries are being created by entrepreneurs using cannabis as an ingredient in products such as oil, beer, cosmetics, beverages, pills and medicine.

A glance at companies pumping money into cannabis production, packaging, processing and trading, some of which are listed on various stock exchanges, proves that the smart money is on the green herb.

Because our province and country are part of the global economy, we cannot continue to hide our heads in the sand on this matter.

For our economy to grow, we need to tap into emerging economies like this so that new growth engines are started for the benefit of all our people.

We have a choice to either join the emerging cannabis economy or watch from the sidelines, like we did with our mineral resources, where foreign companies mine them in SA but process them outside our country, benefiting those economies instead.

Given the abundance of cannabis in our province, the reported potency of its cultivar, the existing skill to plant, produce, harvest and sell the herb, the time has come for the Eastern Cape to open its eyes to the benefits of the huge potential economic spin-offs such as jobs and contracts for farmers and traders.

The first point for us is to legalise the production, use and trading of cannabis so that everything we do is within the legal framework, regulated by the constitution.

While we are looking at the economic spin-offs of the herb, we also need to address the potential medical threats, since there are reports of health problems for those who smoke it. But it is important for society to embrace the broader use of cannabis beyond the recreational smoking that we have mainly known it for.

From obtaining legislative approval of the use, production and trading of the herb, we then have to set in motion regulatory mechanisms to prevent medical problems and monopolies, and to protect cannabis farmers from abuse by profit chasers.

We must not shy away from protecting intellectual property, when it comes to the skills of producing this herb, from economic vultures hovering around to snatch their lucrative prey.

A lot of work has been done by the national and provincial government in terms of engaging potential investors looking at setting up cannabis production facilities in our province.

We are in this to create jobs and business contracts for the people of the Eastern Cape, which is why we are putting them first as we pursue this emerging economy. It is imperative that work being done by government entities be streamlined into one process so that government support is structured to enable villagers growing the herb to benefit from all value-chain stages.

For this economy to benefit the people of the province, we need to have municipalities and broader government institutions functioning as growth engines. If global companies can invest billions, create jobs and opportunities for herb farmers and continue attracting billions into cannabis investments, why is our government not investing money for research, development and setting up cannabis-related industries?

Given our ongoing investment into the agriculture sector, the Eastern Cape has no choice but to be involved in affirming the cannabis economy for our growth. With the production, distribution and trading experience we have - albeit illegal at the time - we have a base from which to launch a massive economy that can buoy rural villages into economically active centres.

But growing the herb is not the only option. We are moving to concretise plans to process, package and export both finished products and the herb to major markets in other provinces and countries.

For this to come to pass, we will assemble a team of experts to advise the provincial government on the process.

Part of their responsibilities will be to propose options for the province to benefit from this emerging economy. There are various growth opportunities within it.

Such a team will include constitutional law experts to advise on speeding up affirmative legislation and scientists to provide advice for production and use.

Because we want to grow the economy, we will include economists to map out business processes and opportunities for producers and traders from our province. Our state-owned entities will provide funding and investment support suitable for the cannabis economy so that we industrialise it by focusing on its primary, tertiary and agro-processing aspects.

We will invest in social facilitation, community engagement and medical support.

We cannot run away from the fact that the illegal production and trade has given some villagers a source of income, as well as production skills and trading mechanisms that will be critical when the herb is fully legalised.

The cannabis economy demands a reconfiguration of our thinking as government and broader society to ensure our province benefits. This is one match we are not going to watch from the sidelines. We are taking part as main players and we are in it to win it.

Lubabalo Mabuyane is the premier of the Eastern Cape and the provincial chair of the ANC


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