It’s high time for SA to grow its cannabis economy
Is cannabis the jackpot SA’s been waiting for?
What role can cannabis play in rebuilding the SA economy after Covid-19? Is cannabis green gold, as many claim, or fool’s gold, as we’ve seen in Canada? Does it really have health benefits, or is that all smoke and mirrors?
To answer these questions and more, Business Day, in partnership with Afriplex, recently hosted a webinar where industry experts explored the growth of the cannabis economy.
Radio presenter Joanne Joseph moderated the discussion between managing partner of the African Growth Fund Mark Diuga, pharmacist and holistic cannabis practitioner at Releaf Pharmaceuticals Sean Willard, economist and trend analyst at Flux Trends Bronwyn Williams, and CEO of Wesgro Tim Harris.
Watch the video below:
Green gold or fool’s gold?
Diuga explored what SA can learn from Canada’s mistakes after legalising cannabis in 2017.
“Every entrepreneur believed they had the best new company, saw it as a get-rich-quick opportunity and made blind investments. Product prices dropped drastically and so did share prices. A lot of investors got burnt in the process. We need to make sure we protect investors,” he said.
Why bother then? “Cannabis is one of the fastest-growing industries in the world,” he said. “The UN reported that close to 250-million people around the world consume cannabis.”
The fact that cannabis is a health and wellness product and available despite the Covid-19 pandemic makes it even more attractive to investors.
“There’s so much you can do with one plant. It’s a huge opportunity to create a tangible impact locally, to create a winning portfolio of companies, rather than just one or two individuals, and to really make sure SA competes globally.”
Cannabidiol — not all smoke and mirrors
Willard argued that stigma and misinformation are holding the cannabis economy back. “As a pharmacist, I was sceptical about cannabis and CBD, as were my fellow medical friends, but through education came perspective.”
CBD is cannabidiol, or one of Willard’s three Cs:
- Cannabis — a type of plant that includes both hemp and marijuana
- Cannabinoids — chemical compounds formed in cannabis and in the body
- Cannabidiol (CBD) — a cannabinoid produced in cannabis
“It’s important to understand that there are different varieties of cannabis. Hemp is a variety of cannabis with tall, sturdy stalks and low levels of THC, while marijuana has high levels of THC,” said Willard.
Is cannabidiol good for you? Willard explained that CBD products affect the endocannabinoid system, which regulates body temperature, blood pressure and overall homeostasis. This makes CBD products ideal for pain relief and anxiety.
But is cannabis still in vogue?
Economist and trend analyst Bronwyn Williams said that now is a good time to invest in cannabis. “We do need to move fast if we want to take advantage of this emerging, growing, global opportunity that is on the horizon,” she said.
“In SA, we have good growing conditions and our legislation is slowly opening up and allowing businesses the opportunity to participate. However, our government could decide to regulate the industry or extend taxation to these new burgeoning industries to find money to keep the economy going,” she said.
But it’s not all doom and gloom. “Globally, the recreational cannabis user still accounts for two thirds of the global cannabis market — that enormous market we see creating jobs, services and businesses in places such as Canada and across Europe. The medical use of cannabis is still only one third of the market, so that is an opportunity that might stimulate ideas,” said Williams.
She shared fascinating anecdotes of how this growing market is creating entirely new product categories, for example:
- Marijuana to help working mothers cope with stress;
- Marijuana-infused menstrual products to alleviate pain; and
- Cannabis as the new champagne for teetotallers.
“We need to make sure regulation enhances the ability of the industry to compete: this market has the opportunity to create more jobs as well as a more inclusive economy,” said Williams.
Cape Town — a fertile hub for medicinal cannabis
Harris argued that the Western Cape, as the fifth-largest exporter of agricultural goods in Africa, is in a prime position to become the medicinal cannabis hub of Africa.
What makes a cannabis hub? Competitive advantage, differentiation and exporting — and Harris believes the Western Cape can deliver all three. “We already have the ecosystem in place in terms of agriculture, medical, and research & development,” he said.
After the presentations, Afriplex MD Danie Nel joined the speakers in a panel discussion on the role of cannabis in rebuilding SA’s economy.
Afriplex is a SA company rooted in the development and manufacturing of botanical extracts, complementary medicines, and food and beverage product solutions.
Visit www.afriplex.co.za to learn more.
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