South Africa: SA and Legal Cannabis - Profits Should Be Reaped, but Like Any Industry, There Are Also Risks

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(file photo).

South Africa's cannabis conversation is shifting into a new gear, with Finance Minister Tito Mboweni on the record as pushing for full legalisation. Such a move will be welcome, with plenty of economic potential to unlock. But others experiments with legal, regulated pot usage, and uniquely South African circumstances, highlight the potential risks as well.

Colorado, a mountainous US state better known for skiing and trout fishing, has been a trailblazer in pot policy. In a Rocky Mountain high, it was the first US state to "go legal", allowing the production and sale of marijuana for recreational and medical use.

That seems to be paying dividends. State coffers, for a start, have had an additional source of revenue. Total sales since legalisation in 2014 have amounted to $7.6-billion, according to the Colorado Department of Revenue. From that, more than $1.2-billion in tax and licensing revenue has been collected -- and counting. In the 2019 fiscal year, the cannabis industry generated $302-million for the state, more than the sums garnered from either alcohol or tobacco sales.

A South African audience might look at that and think, wow -- that works out to roughly R5-billion. That's 25 Nkandla upgrades complete with fire...

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