Cannabis Regulation In Latin America: Towards An Integrated Market Or Stagnation? – Aurora Cannabis (NASDAQ:ACB)

[ad_1]

By Pablo Fazio

The process of regulating cannabis has been complex and varied, with advances and setbacks occurring in different regions around the world. While much of the global attention is focused on the United States, where the rescheduling of cannabis dominates headlines, the situation in Latin America—a region that has been actively involved in this debate—has not been much different. The political swings faced by various countries have been reflected in the pendulum-like nature of their public policies on cannabis.

Brazil has recently emerged from a highly conservative government that was focused on restricting any form of regulation that might broaden cannabis use, leaving a legacy that still weighs heavily on the development of its market. The country still does not allow cultivation for commercial purposes domestically, sparking debates around dependency on imports and the rising cost of medicinal products. With the return of Lula da Silva, the center-left government is showing signs of loosening regulations, potentially positioning Brazil as an industrial powerhouse in the global cannabis market. In 2023, the Brazilian medicinal cannabis market generated approximately R$ 700 million (around USD 140 million), representing a 92% growth compared to the previous year. It is estimated that over 430,000 people use cannabidiol (CBD) to treat various medical conditions. The Brazilian Health Regulatory Agency (ANVISA) has authorized the sale of 26 medicinal cannabis products, including oils and extracts, which can only be prescribed by physicians and purchased in authorized pharmacies.

In contrast, Argentina, which in recent years had experienced significant progress in cannabis regulation, has paused this process since Milei took office. Everything now seems frozen, contradicting the new president’s promises to deregulate the economy “to unleash the country’s productive forces.” Changes in the REPROCANN program (Resolution 3132/2024, which introduced modifications in control and oversight mechanisms for the medicinal use of cannabis) and the recent intervention of ARICCAME (Decree 833/2024) have created an environment of uncertainty. Despite this context, some industry players, such as Cannava (the government-owned company in Jujuy), have started exporting pharmaceutical-grade flowers to countries like Portugal, Germany and Australia. Therapeutic products are also being dispensed in their pharmacies (Pampa Hemp Dispensary) in the form of full-spectrum magistral preparations. Despite these advancements, the overall situation of the sector is marked by great uncertainty, triggering a decline in investment confidence, and many companies are struggling to sustain their operations.

Colombia and Uruguay, considered pioneers in cannabis regulation in the region, show figures that expose the harsh reality of the failure of the models implemented due to a lack of political will and boldness to fully develop this sector within their economies, limiting business opportunities for the industry. Although a small number of companies have managed to find profitable niches, especially in the export of medicinal cannabis and derivative products (amounting to around USD 40 million in total), the sector, in general, has been condemned to excessive bureaucracy, commercial unviability, and financial difficulties, leading some companies to shut down operations. The loud exit of Aurora Cannabis ACB, the Canadian giant, from the Uruguayan market is a clear sign of this situation.

Mexico, another of the region’s great promises, awaits the long-overdue reform to regulate recreational and medicinal cannabis use under Claudia Sheinbaum’s administration. Although the country’s Supreme Court declared in 2018 that five articles of the General Health Law prohibiting recreational cannabis use were unconstitutional, arguing that they violated the right to free personal development, the issue has not successfully passed through Congress. According to a 2021 report by Endeavor Mexico, the value of the cannabis industry was projected to reach USD 2 billion by 2028, driven by both the medicinal market and responsible adult use.

In Chile and Peru, where medicinal cannabis use is legalized, the implementation has been extremely slow, with numerous restrictions and difficulties in distribution and patient access. A large part of the market still relies on imported products, which has hindered the growth of a strong local industry. Meanwhile, the illegal market continues to flourish with little control, while formally established companies face increasingly stringent regulations.

Paraguay and Ecuador, although their legal frameworks allow for the cultivation and importation of cannabis derivatives for medical purposes, are still in the early stages of developing local medicinal product production. Nonetheless, both countries have made significant strides in hemp cultivation and processing. Companies like Healthy Grains in Paraguay and Barad in Ecuador have pioneered this sector, managing to export over 1,000 tons of biomass and hemp-derived products to more than 30 international markets. The main export destinations include Canada, the United States, Mexico, Costa Rica, Brazil, the United Kingdom, the Netherlands, Greece, Lithuania, Germany, the Czech Republic, and Australia.

The status of cannabis in Bolivia remains strictly prohibitive for both recreational and medicinal use. The government of Evo Morales, a former coca-grower union leader, has focused its policies on defending the coca leaf. The main argument of his administration is that the coca leaf has deep-rooted ancestral significance, with legitimate medicinal and cultural uses, while cannabis, on the other hand, is not part of that tradition, and its legalization could exacerbate drug trafficking issues and harm Bolivia’s international image in the fight against drugs.

Regardless of the particularities in each country, the cannabis industry in Latin America faces structural challenges that hinder its growth and complicate the integration of a regional market. These common challenges across the region limit the industry’s capacity to achieve its potential in terms of economic and social development.

Among the main obstacles are delays in the implementation of regulations that, in many cases, remain entangled in prolonged bureaucratic processes. Likewise, there is a lack of institutional training that complicates the effective application of regulations, with insufficient oversight facilitating the proliferation of the black market and the uncontrolled supply of products reaching the public without any health monitoring. This situation not only generates unfair competition but also affects public health, exacerbates safety risks, and undermines confidence in the legal industry. The lack of medical knowledge about therapeutic cannabis and the limited educational offerings in academic institutions further complicate access to safe and quality treatments. Currently, the prescription of medicinal cannabis remains a practice limited to a minority of specialists. This shortage of trained physicians highlights the urgent need to train more professionals, which could significantly expand its adoption as a therapeutic alternative.

Finally, it is essential to critically examine the role of civil society and its difficulties in articulating a common agenda around cannabis regulation. This process has been driven by a diverse set of actors—including patients, health organizations, private companies, NGOs, and groups advocating for drug decriminalization—who, in many cases, do not share unified interests or visions. Their heterogeneity, while reflecting a richness of perspectives, has also generated contradictions that complicate clear and coherent dialogue with policymakers. This fragmentation has allowed certain sectors to blur the lines between recreational and medicinal cannabis use, using ambiguous interpretations of the regulations to push scenarios.

From an institutional perspective, this approach not only erodes the legitimacy of the milestones achieved but also endangers the political capital needed for these initiatives to progress within the framework of democratic debate. By failing to consolidate a foundation of agreements and a commitment to respect collective efforts, demands become muddled, which not only generates distrust among the public but also undermines progress in critical areas such as access to medical treatments. In this complex governance context, the excesses allowed by some groups and the aforementioned lack of cohesion have been capitalized on by reactionary sectors, who find in them a justification for opposing more forcefully and promoting more restrictive policies.

In conclusion, the cannabis industry in Latin America is far from reaching its full potential. The combination of a confusing regulatory environment, lack of training at all levels, and poor coordination among key stakeholders remains a significant barrier to its development. Without a more comprehensive approach and the building of political majorities that understand the potential and express the will to move forward, the region risks falling behind in the emerging global cannabis market.

*Pablo Fazio is the President of the Argentine Chamber of Cannabis (ARGENCANN) and Director of PAMPA HEMP.

This article is from an external unpaid contributor. It does not represent Benzinga's reporting and has not been edited for content or accuracy.

[ad_1]

Source link : http://www.bing.com/news/apiclick.aspx?ref=FexRss&aid=&tid=66ff500e3d4b442ca833cf9190f42a2f&url=https%3A%2F%2Fwww.benzinga.com%2Fmarkets%2Fcannabis%2F24%2F10%2F41171272%2Fcannabis-regulation-in-latin-america-towards-an-integrated-market-or-stagnation&c=9103578095499960818&mkt=en-us Author : Publish date : 2024-10-03 08:43:00 Copyright for syndicated content belongs to the linked Source .

Cannabis Regulation In Latin America: Towards An Integrated Market Or Stagnation? – Aurora Cannabis (NASDAQ:ACB)

‘It’s a brotherhood’ North Texas firefighters welcome Latin American ‘bomberos’ for unique training experience

Ripple Defies US Blockade, Despite US Blockade, Ripple Expands in Brazil as XRP Investors Eye RCO Finance

Ripple Defies US Blockade, Despite US Blockade, Ripple Expands in Brazil as XRP Investors Eye RCO Finance

Café 080 | The nicest Dutch café in Aruba – Wereldreizigers.nl

Embark on an Epic 129-Day Adventure: Discover Holland America’s World Cruises!

Tragic Discovery: American Citizen Found Beaten to Death on Bahamas Beach

Inside African American History With Barbados And Why Every Black Traveler Should Visit – – Black Enterprise

How a Daring Raid on Bermuda Turned the Tide of the American Revolution

Brazil Now Requires Tourist Visas for U.S. Travelers – Upgraded Points

Discover the Ultimate British Virgin Islands: Top Beaches, Vibrant Nightlife, and Breathtaking Nature!

Americans, Canadians shake hands at the border in show of ‘longstanding friendship’ – Cascadia Daily News

Excitement Builds as North American Cup Cricket Tournament Launches in the Cayman Islands!

AP PHOTOS: Chile’s capital has the oldest hat maker in South America – AP News

Categories

Archives