In recent years, the United States and countries around the globe have legalized medical marijuana. Several states in the U.S. have gone further and decriminalized the recreational use of cannabis. Growers and distributors of cannabis in the U.S. and Canada have been capitalizing on the growing cannabis industry. Doors have also been opening for companies based in Latin America and the Caribbean (LAC) countries like Jamaica, Colombia and Uruguay.
According to the World Health Organization, 80 percent of the world’s population uses marijuana for medicinal remedies. People know Latin American and Caribbean countries for their expansive farms and high levels of agricultural exports. Cannabis companies can leverage these existing production and distribution channels to their benefit. Ideal climate conditions coupled with increasing investment flows have positioned South America and the Caribbean for explosive growth. Some estimate the industry to grow to $55.8 billion by 2025.
Jamaican Agribusiness Shifts Priorities
In 2015, Jamaica became one of the first countries to decriminalize marijuana. Jamaicans can possess up to two ounces of marijuana. A license to grow marijuana costs $300 and allows citizens to cultivate five cannabis plants. The government is taking proactive steps to capitalize on the growing number of countries legalizing the use of marijuana by supporting local companies and universities in their research and production.
In September 2019, Jamaica’s Ministry of Commerce, Agriculture and Fisheries, announced it would be partnering with Harvard International Phytomedicines and Medical Cannabis Institute (HIPI). Through this partnership, HIPI will conduct research on the pharmacological benefits of cannabis. Jamaica aims to capitalize on this partnership and use it as an opportunity to grow and develop its national marijuana industry.
The Alternative Development Programme (ADP), a new government program in Jamaica, has the purpose of helping farmers benefit from the growing cannabis industry. The purpose of the program is to assist farmers in their transition from small-scale farming to large-scale farming to supply large international companies.
Uruguay’s Trailblazing Stance on Marijuana
In 2013, Uruguay became the first country in the world to fully legalize both the medicinal and recreational use of marijuana. Combating gang violence was one of the Uruguayan government’s top motivators behind legalization. Despite it being well-known as one of Latin America’s safest countries, Uruguay’s crime rate has been steadily on the rise. By targeting drug cartels’ highest source of revenue, the government hopes to curb the growing violence stemming from the illicit drug trade.
Fotmer Life Sciences is a cannabis cultivator based in Uruguay. In September 2019, Fotmer became the first company to legally export medical cannabis from Latin America. Its first export partner was Australia, and Fotmer also trades with Germany and Canada. Diego Oliviera, the head Uruguay’s national drug agency, hopes to expand Uruguay’s place in the marijuana industry by expanding exports from solely marijuana plants to finished products, like oils. Although Uruguay is home to three other marijuana-based companies, Fotmer is the only company with a license to process and export the marijuana flower and products for direct consumption.
Marijuana as Colombia’s New Most Popular Export
Colombia, known for its petroleum and coal supply, can attribute 57 percent of its total export value to just that. Coffee and spices make up an additional 6 percent of exports due to Colombia’s ideal climate and 12 hours of daylight year-round. It is looking to attract cannabis cultivators using the same ideal conditions as a selling point and viable alternative to growing in countries like Canada and the United States, where people have to spend significant amounts of money on greenhouses for colder seasons.
Desired Effect of Legalization on Crime
In Colombia, the laws regarding marijuana are not as progressive as those in Uruguay. People can possess small amounts of marijuana and medicinal use is legal, but recreational use remains a criminal act. Similar to Uruguay, the Colombian government hopes that legalizing cannabis use will decrease gang and drug-related violence.
Drug- and gang-related violence is second to cancer as a leading cause of death in Colombia. It is too soon to tell whether legalization has had an impact on crime, but the strategy is to crimp revenue streams of gangs by making the illicit marijuana market. Now that it is legal for marijuana to grow for medicinal purposes, cannabis industry workers hope to attract investors. The Colombian Cannabis Industry Association (CCIA) has 29 member companies who have invested over $600 million in the construction of medical marijuana facilities.
It is becoming increasingly popular for Latin American and Caribbean countries to capitalize on the opportunities that arise from the growing cannabis industry. As more and more companies look to locate their farms to the Caribbean and South America, LAC countries are seeking to benefit by coupling foreign investment with academic and industrial research in the hopes of reaping socio-economic dividends for everyone.
– Desiree Nestor