US Federal Marijuana Legalization in 2030?
Got to be a guest on a podcast last night with Hi-Curious and the question when the US will see Federal cannabis legalization came up, and ironically, one day after President’s Biden’s State of the Union Address, all the panelist shared the same gloomy outlook. Biden is a fierece War on Drugs dinosaur and actually wrote many of the laws still keeping marijuana prisoners in jail. Democrats will lose seats in the House and Senate at midterm elections. The “next guy”, whether Biden for a second term, Trump Part 2, or Mitt “Only Stupid People Use Marijuana” Romney are all not fans of legalizing marijuana. So while America seems stuck in the mud on Federal legalization, the rest of the world seems to be moving forward with marijuana legalization, dispite UN Drug Treaties listing cananbis as a schedule 1 drug.
All the speakers gave the advice that if you are investing in cananbis right now, you better have a 5 to 8 year timeline for US Federal legalization, as “right around the corner” looks dubious at best for legal weed.
The outlook of global cannabis markets within the last five years is incredible. The cannabis industry has soared to unexpected heights. Medical and recreational cannabis programs are expanding in all regions of the world. Although the growth is faster in some areas than in others,
Before the pandemic, 50 countries had legal, medical cannabis industries, with only two having recreational cannabis markets. The onset of the pandemic made many governments and citizens come to terms with the potential of the cannabis market, as well as the therapeutic benefits the drug has to offer. The latest country to officially legalize adult-use cannabis is Malta. Another European country, Luxembourg, recently decriminalized the use of adult weed but declared that its residents could grow it for personal use only, not for commercial reasons.
Most global cannabis reports base their findings on the United States and Canada. But there are other large cannabis markets with excellent prospects around the world. By 2025, experts predict that the global cannabis market will be worth at least $40 billion, with a large percentage of this coming from North America. Still, it won’t hurt to look into other international markets, especially those that have the most to offer this year.
European Cannabis Industry
The European cannabis industry shows promise for the coming years. The introduction of its first medical cannabis exchange reader fund (ETF) sold its potential to offer promising and lucrative opportunities to operators in the sector. Several countries in Europe are quickly looking for ways to adopt a legalized commoditized cannabis market. A few of the countries to have successfully pulled this off include Germany, the Netherlands, Spain, and the Czech Republic.
The Netherlands, specifically Amsterdam, is one of the few regions where European tourists can freely consume cannabis. Yet, recreational cannabis is not legal.
Currently, all eyes seem to be pointed at Germany. The country is looking into expanding its legalization efforts to include recreational cannabis programs. With a population of about 81 million people, Germany could effectively create new opportunities for economic growth to benefit its citizens. The MJBizDaily 2021 Annual Marijuana Business Factbook predicts that Germany’s adult-use market will exceed California’s within its first few years.
Germany’s large tourism sector, which brings in at least 40 million international citizens yearly, will likely increase once legal adult-use cannabis is approved and sold within Germany. This will be a win-win for the cannabis sector and the tourism industry.
Everything in the European cannabis market could change if Germany signs adult-use cannabis into law. In late 2021, the country’s three major political parties agreed to regulate adult-use weed distribution and sales, which means that it’s no longer a matter of “if” but rather “when.” Once Germany succeeds in this, other European countries will follow suit.
South America and Central America
Both regions are steadily making advances to legalize cannabis and expand existing markets. Last year, Panama established its medical cannabis industry in August, while Colombia approved the sales of cannabis flowers to other countries. On the other hand, Mexico has finally published the rules and guidelines that would regulate its newly established market.
South American and Central American countries are silently moving to open up their regions for international cannabis sales. Columbia and Mexico are making the most moves, and investors are looking to invest in both countries. Mexico’s extensive population of 131 million makes it the potentially largest cannabis market in Central America. While Columbia is on the path to being one of the largest exporters of dried cannabis flowers in South America.
Meanwhile, some South American and Central American countries have yet to decide on legalizing cannabis for medical or adult use. For instance, the Legislative Assembly of Costa Rica successfully approved the medical cannabis law earlier this year. Only for the country’s president to take the entire process several steps back by vetoing the bill. Now, Congress is expected to go back to the drawing board to make the changes proposed by the president. Whether or not this bill will get to the president’s table in a few months is uncertain. Both South
America and Central America are facing their fair share of obstacles. However, this has done little to hinder or kill the cannabis industry’s vision for the region. In the near future, both areas will have fast-growing cannabis markets with significant economic boosts.
Africa and Asia
Africa has optimal weather conditions suitable for cannabis cultivation, but the region remains one of the lowest producers of the crop. This could be a thing of the past, as recent updates coming from Zimbabwe, Ghana, and South Africa show some countries are ready to do exploits with legal cannabis markets.
For instance, Zimbabwe has issued permits to about 56 global and local businesses to cultivate and process medical cannabis and hemp. These licenses were issued in September 2021, after a three-year wait since the country decriminalized medical cannabis. The government disclosed that it is planning to be a significant exporter of cannabis products grown in Africa. Since these announcements were made, giant cannabis corporations in Canada, Switzerland, and Germany have expressed interest in investing in the country.
The reverse is the case in Southeast Asia. The region still maintains some of the harshest drug laws and punishments in the world. For now, only Thailand seems to be making advances to shake off the Southeast Asian anti-cannabis stance.
In 2018, Thailand approved the use of medical cannabis. It went further by decriminalizing the production and sales of medical cannabis in 2020. This year, the country plans to drop cannabis from its list of addictive drugs, making it a step closer to complete decriminalization. This move has brought Southeast Asia closer to accepting cannabis plants.
Several Canadian and U.S. operators have begun to lay claims in various international cannabis markets. Large companies like Tilray and Casa Verde Capital plan to have an early foothold in countries that could have potentially large cannabis markets. As this international cannabis market continues to develop, expect more countries to expand their legalization programs and become more relaxed in enforcing cannabis possession rules.