LATAM: An update on cannabis in the region (September 2021)
Today’s article will be an update on the cannabis market in Latin America, and during the last couple of months there have been a few developments. One interesting point to note before getting into any details is that with an industry such as this, legislation and attitude are difficult entities to change. This is to say that the lag-time between a government meeting or a protest by members of activist groups campaigning for changes to be made to the legal status of cannabis and subsequent tangible change is not instant. This means a great deal of patience is needed when keeping an eye on updates, however, it is not all moving at a snail’s pace, and as more countries are immersing themselves in the possibilities of relaxed legislation and the benefits that come with this, the market expansion leads to new opportunities, and more importantly, new updates for us to share with you!
The first piece of news we have to bring to you today is more general as opposed to our usual style of being country specific. The potential within Latin America to become one of the, if not the leading global market for legalised cannabis comes down to a number of factors, one of which is cost. The key statistic is that it has been reported that due to cost-effective measures in a number of sectors, such as labour costs and the cost of building the necessary infrastructure to facilitate cannabis production leads to the conclusion that Latin America could be 80% cheaper than North America, further reinforcing the potential that exists within the region for the legal cannabis market.
This update is slightly unusual as it is not necessarily a pull factor for investors, but rather an innovative, pioneering move to capitalise on the status of Uruguay as a global leader to cannabis decriminalisation and general legalisation. The nation is looking to make it legal for foreign tourists to buy recreational marijuana, with an aim to curbing the illegal drug trade associated with people arriving in the nation and looking to purchase banned substances. It has been made clear that this is the motive of the potential legislation and not to be an attractive factor for foreign citizens to visit Uruguay. The secretary of the National Drugs Board has said that the introduction of this idea could actually be by the end of the year, marking the rapid changes made possible by changing attitudes towards cannabis.
The final headline we have for today comes from Panama, where, at the very end of last month following our last update post, a bill to allow the use of medicinal cannabis was approved. Latin America, although extremely forward thinking in regard to this topic in a broad sense, the Central American nations have not been so fast to approve relaxed cannabis legislations, making Panama one of the pioneering nations in this respect and this piece of news all the more significant. The bill was unanimously voted for in favour of the reform, demonstrating the desire for change moving towards the future and getting involved with one of the largest and most promising growing markets.
If you would like to stay up to date with the cannabis market in Latin America, do not hesitate to get in touch with us today. At Creimerman, we assist our clients with their cross-border ventures, striving to help make them a success, and we would love for you to be the next.