Cape Town city council has given the green light for a 2.1 billion rand ($140 million) medical marijuana facility that will employ 250 people.
Earlier this week, South Africa legalized CBD sales and it has already decriminalized adult-use marijuana after the Constitutional Court decided a ban was unconstitutional. There are a few small licensed producers beginning to cultivate medical cannabis, but this project will step things up several notches.
Cape Town council agreed to release a portion of vacant land within the Western Cape’s Atlantis Special Economic Zone for the facility to be built. ‘This positive move by the city gives us the opportunity to unlock the economic benefits with the resultant job creation opportunities that this emerging industry will present,” said Alderman James Vos, the mayoral committee member for economic opportunities and asset management.
The first phase of the project will see an investment of R638 million during construction. A further R1.5 billion will be invested during phase two, although that will not be finished until 2023. By then a total of 250 jobs will have been created, the council said.
Vos called medical cannabis an untapped economic sector, promising the people of Cape Town that it will bring income, jobs and skills development to the city, which is the third richest in Africa after Johannesburg and Cairo.
There is already a project underway nearby to create a facility that will cultivate cannabis, extract the compounds, and produce oils and capsules for medicinal purposes. Another local firm is producing modular cannabis cultivation kits. Vos is hoping an industry can flourish in Cape Town, due to its proximity to “excellent universities and world-class infrastructure”.
South Africa’s attitude towards cannabis use is becoming increasingly liberal. Until this month, CBD was on a par with heroin within the Medicines Act, but it has now been reclassified and that means it can be sourced by anyone with a prescription who visits a pharmacy.
However, the health minister went one step further by positioning low-dose CBD products outside of drug regulations for the next 12 months, meaning they can be purchased without the need for a prescription. This can be extended when the 12-month period ends.
The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Grizzle hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.