Delays to authorise an investor to start growing and processing industrial hemp would cost Malawi about K75 billion ($50 million) in potential revenue as the firm has threatened to pull out of the country.
Ikaros Africa country operations director Chauncy Jere said Malawi Government was delaying the licence to enable his firm begin growing industrial hemp and process the crop into medicinal products.
In an interview on Saturday, he said the company, which is operating in a number of countries in Africa and other continents, is contemplating relocating its investment to Mozambique because of red tape.
He said: “We have made an investment of over K1.9 billion in three years. We have been operating with expectation that everything would be finalised soon.”
Jere said the company has been conducting trials in the country to assess the viability of growing cannabis.
He said Ikaros Africa has been conducting a research at Chitara in Salima where findings confirmed that the country can manage to grow the crop in abundance.
But Ministry of Agriculture, Irrigation and Water Development Principal Secretary Grey Nyandule Phiri denied knowledge of any information that the company is contemplating to pull out of the country.
In an interview, he proposed that the investor should wait until government puts in place the regulatory framework to govern growth and use of the industrial cannabis.
Said Nyandule Phiri: “No one has been given the licence. Government is putting the regulatory framework first, so everybody is waiting for that.”
He said the regulatory framework is expected to be finalised by the end of this year.
Economist Chikumbutso Kalilombe, who is also president of Economics Association of Malawi (Ecama), said in a telephone interview yesterday that government should consider giving the issue of industrial hemp the required attention so that it should not lose some of the opportunities that would help in boosting the country’s economy.
He said: “I do not have details on the processes Ikaros have been undertaking. But all what I can say is that government should give this issue a necessary attention.”
Research and development consultant on economic and social issues Collen Kalua warned that if the investor pulls out government will lose in terms of revenue collection from employees as well as the company.
The company’s threat comes days after the United States government had shown reluctance to keep buying the country’s tobacco, which has been one of the major sources for the country’s economy.