Latin America: the fastest growing cannabis industry?

Let's open ourselves up to the rest of the world. Let's leave the European sphere. Let's observe the evolution of the cannabis sector elsewhere. We immediately see that Latin America may have the fastest-growing cannabis industry. In this regard, we propose to provide an overview of the leading players, firstly, and secondly, to present some factors contributing to this rapid growth.

Colombia is in control

Indeed, Colombia could very well become the world's largest supplier of medical cannabis. This may seem strange, especially given the country's limited technological resources, at least compared to other major Western powers. In fact, the government aims to outmaneuver drug gangs. To this end, it decided to regulate the medical cannabis sector in 2015. From this perspective, for this industry to develop rapidly, it is essential to adopt the right strategies.

In this context, the focus has shifted to reducing production costs and implementing progressive legislation. These two factors, combined with the Colombian climate and the country's advantageous location, contribute to the rapid growth of the cannabis industry. All of this makes Colombia a formidable competitor and therefore highly receptive to foreign investment, which, in turn, further strengthens and boosts the sector.

Mexico, an attractive hub

Indeed, Mexico legalized medical cannabis in 2017. It's worth noting that the reasons are essentially the same as those in Colombia. Specifically, the import, sale, and consumption of products containing less than 1% THC are permitted. In this context, Mexico is likely to become one of the main cannabis markets in Latin America. The country boasts a population of 128.6 million, of whom 10% receive medical cannabis.

This makes it a gigantic market. Consequently, a focal point for investors. In fact, many Canadian companies would like to invest there. Why? Because they see Mexico as a catalyst for the North American cannabis market.

Uruguay: Appealing to investors with a lenient cannabis law?

In fact, Uruguay is sandwiched between Brazil and Argentina, two countries relatively more advanced in the cannabis industry. Consequently, it has been somewhat overlooked. Major investors are currently absent. Nevertheless, the country hasn't given up hope. Indeed, to foster the growth of this sector, Uruguayan lawmakers are using a tool that could very well hit its target. What is it? Lenient cannabis laws for nearly eight years! In just a few years, with government approval, it became the first country to achieve $1.1 billion in annual exports of medical cannabis products.

In reality, this lenient legislation reassures investors. Deep down, they know their investments are safe and that the risk of loss, sometimes due to repressive laws, is minimal. As a result, they don't hesitate to invest. This is simply beneficial for Uruguay.

Suriname is invited to the table of the greats!

Suriname is certainly not one of those countries that would readily come to mind when discussing the cannabis industry. However, nature has endowed it with considerable potential for this sector to flourish. Indeed, the country boasts an excellent climate and low production costs. Therefore, the leaders intend to make good use of this. In this regard, the cultivation of hemp and DPC (drug-resistant cannabis) has already been authorized. Nevertheless, the legalization of medicinal herbs is not yet complete.

 However, Suriname has everything it needs to do well in this sector. Furthermore, its relationship with the Netherlands facilitates exports to Europe. Its location also makes exports to North America easier. Now, we must wait for the legalization process to be fully completed. The government is still considering the implementation of a regulatory framework.

Has Latin America found the winning combination?

Indeed, given the rapid growth of the cannabis industry in Latin America, it's legitimate to ask: What's their secret? On the one hand, we see that these countries have been able to capitalize on what nature has provided: a favorable climate and an abundant workforce. The result: low production costs! On the other hand, they've added a degree of legislative flexibility. In fact, legislators know that by being less repressive in their laws, they attract investors and thus maintain control over the sector. This combination proves successful and could even, in the long run, harm the black market.

Our source: Commentary Box Sports.