HARARE – Zimbabwe could earn $19 million (R280m) from taxes on cannabis, which the country has just started to venture into after legalising the growing of medicinal marijuana, say experts.
The Zimbabwean government has been keen to follow in the footsteps of South Africa, which has legalised cannabis.
Government officials say that Zimbabwe could realise much foreign currency earnings from industrial hemp and medicinal cannabis.
Ivory Medical has already been granted the green light to grow medicinal cannabis at a prison facility in Zimbabwe under a partnership involving the Ministry of Health and funded by NSK Holdings, other international investors, and Portuguese technical farming support firm Symtomax. This comes at a time that Zimbabwe is seeking to extend its earnings from the agricultural sector through expansion from tobacco and cotton.
Apart from medicinal cannabis, Zimbabwe is also weighing hemp production options, seeking to capitalise on the marijuana strain’s industrial usefulness.
Experts from New Frontier Data, which specialises in intelligence on the global cannabis industry, said that there are about 1 million consumers inside Zimbabwe with the potential to spend more than US$200m each year.
“Hemp cultivation, especially given the explosive demand arising from neighbouring European nations, presents a unique opportunity to Zimbabwe and other African nations well positioned to meet such demand cheaper, and possibly faster, than current suppliers from Canada and Latin America,” said Giadha Aguirre de Carcer, the chief executive of New Frontier Data.
The “combined tax revenues from domestic sales and exports over a five-year period could reach nearly US$19m”, which will be a boost for the country, struggling with a severe foreign currency crunch.
Moreover, prospects for tobacco, one of the country’s biggest foreign currency earners, appear to be waning owing to pressure from global campaigns against the consumption of tobacco as well as the effects of climate change on the quality and quantity of tobacco produced in Zimbabwe.
Experts at consultancy firm Prohibition Partners have already said “Africa’s legal cannabis industry could generate more than US$7.1billion annually by 2023 if a number of the continent’s major markets open up and mirror the trend of legalisation” seen in the US, Canada and Europe. Lesotho became the first African country to legalise marijuana farming in 2017.
Its decision to view marijuana as a source of national revenue rather than petty crime marks a shift in a region where marijuana is widely used and regularly illegally exported across borders.