Malawi’s industrial hemp could out-perform tobacco industry in time

Cannabis Country File: Malawi

By Edward Tsumele

In the following weeks Cannabis Business Africa/CBA will be profiling southern African countries that are either in the process of legalizing cannabis for industrial hemp production or medical cannabis for research, or have fully legalized cannabis. We will also look at the investment opportunities for investors in this new emerging industry worth billions of dollars once fully running. IN THIS WEEK’S EDITION OF CBA, the focus is on Malawi, a country with a population of 18.63 million and a GDP of $7.667billion.

As a number of countries globally are increasingly realizing the potential of legal cannabis to change people’s lives by growing the economy and creating employment, Malawi, in southern Africa has moved to legalise medical cannabis and industrial hemp.

 This announcement was made by the southern African country in November 2020, suggesting that Malawi is ready to start commercial production and processing of cannabis for medicinal and industrial use, This announcement was made by the newly formed Cannabis Regulatory Authority, suggesting that the country is taking this new emerging industry seriously, and is therefore ahead of others in the region that are still debating the issue of whether they should legalise industrial hemp and medical cannabis.

In fact Malawi’s parliament passed a bill in February, 2020, making it legal to cultivate and process cannabis for medicines and hemp fibre used in industry. But the country that is reputed for producing a popular strain of cannabis for smokers, however did not decriminalise cannabis for recreational use. Cannabis remains an illegal substance for recreational use in that country.

IN the meantime there has been a lot of interest by investors who bombarded the authorities with their applications for licenses ever since the announcement was made.

The board chair of Malawi’s regulator, Boniface Kadzamira, said his board had received more than 100 applications for licensing which were under review immediately after the announcement was made.

And instructively, as opposed to some other countries where the licensing process is often handled by the Departments of Health, the Agriculture Ministry is in charge of issuing the licenses whose fees range from  $100 to $10,000 a year for the cultivation, selling, storage, distribution of either class of industrial and medicinal hemp.

 Public hospitals in that country pay $100 and private hospitals $200 as licence fees to dispense cannabis medicines.

 The authorities in that country believe that the hemp industry can supplement export revenues from tobacco, and could even outperform the tobacco industry in time, especially because the tobacco industry in recent years has in fact declined.

“During the 2020 season, Malawi’s tobacco output fell by 31.3%, resulting in a 26.4% decline in the country’s overall tobacco revenues.

The fall has drastically affected the country’s tobacco auctioneer, Auction Holdings Ltd, which has failed to pay salaries for the last two months,” Reuters reported recently.

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