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South Africa’s Finance Minister: ‘Cannabis Should Be A Legal, Taxable Product’

South Africa’s Finance Minister: ‘Cannabis Should Be A Legal, Taxable Product’

Cannabis reform is spreading across the globe, however, the speed at which it is spreading is not the same worldwide. Africa and Asia have historically lagged behind other continents. Fortunately, momentum for reform is picking up on both continents, particularly in Africa.

One nation that is at the forefront of cannabis policy reform is South Africa. The highest court in South Africa (no pun intended) ruled in September 2018 that prohibition on personal cannabis use was unconstitutional. Part of the ruling tasked South Africa’s Parliament with coming up with what a ‘personal amount’ of cannabis involved.

Significant parts of South Africa’s government opposed the ruling while many lawmakers and other members of the government took the ruling as being an opportunity for positive change. One prominent leader in South Africa is calling for outright legalization, regulation, and taxation.

South Africa Finance Minister Speaks Out

Tito Mboweni is South Africa’s Finance Minister. In a recent interview with Cannabiz Africa Mboweni spoke strongly in favor of setting up a regulated adult-use cannabis industry to generate tax revenue.

“We must move as quickly as possible towards legalization,” South Africa’s Finance Minister Tito Mboweni said according to Cannabiz Africa. “It’s already growing in profusion all over the country, but especially in the Eastern Cape. When it becomes legal, there’s probably at least R4 billion in tax revenue from parts of that province alone, especially what was formerly known as Transkei.”

The comments made by Mboweni came as South Africa’s lawmakers are expected to receive their first viewing of the ‘National Cannabis Master Plan’ any day now. The plan is expected to include provisions that would legalize cannabis for adult use and set up a regulated adult-use industry in South Africa by 2023.

South Africa’s industry is projected to be worth as much as R27 billion (roughly $2 billion) by 2023 and would experience 33% annual growth. South Africa is the fifth most populated nation on the African continent and is home to the continent’s third-largest economy. Nearly half of the country’s population lives in poverty, and the jobs and tax revenues that would be created by a legal industry would be very significant.

A Huge Opportunity For South Africa

Currently, only two countries have fully legalized cannabis for adult use. Those two countries are of course Uruguay which legalized in 2013 and Canada which legalized in 2018. Italy and Mexico both have somewhat similar court decisions as South Africa on the books, and lawmakers there are working to pass legalization legislation.

Multiple countries in Europe are pursuing legalization, with pilot programs ramping up in the Netherlands, and Luxembourg is on pace to legalize in the next year or two. Israel is also expected to legalize cannabis for adult use sooner rather than later.

If South Africa can beat all of them to legalization, it would not only become the third country to legalize – it would also put South Africa in a prime position to greatly benefit monetarily. South Africa would be near the front of the line when it comes to fine-tuning policies and building the necessary infrastructure for its cannabis industry to thrive.

Getting ahead of other countries will help ensure that South Africa’s cannabis industry gains a larger share of cannabis tourism opportunities and would put South Africa in a better position to create business relationships with other countries. By the time other countries get on the right side of history, South Africa could already have a solid global footprint that would be hard to supplant.

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