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The eyes of the Latin American cannabis industry will be on Colombia during the first months of 2023 as the South American nation, which suffered severely from drug violence for decades, appears on track to legalise recreational cannabis.
The legalisation bill has been approved by landslide majorities in four legislative debates, including in the Senate plenary in early December, when it passed by 56 votes to three.
“This is really a historic day because this is the first time cannabis legalisation legislation has been approved in the first rounds of debates,” congressman Juan Carlos Losada said in a video posted to his official Twitter account on 6th December. “There are four more debates that are coming beginning next March, but we believe that this bill is going to be successful in achieving approval.”
Approval of the recreational cannabis bill has been a priority for Colombia’s president Gustavo Petro, who took office in August 2022. Petro has said legalisation will provide economic opportunities to rural farmers and indigenous communities, as well as reduce arrests and drug-related violence.
In order to pass, the bill must be approved in four more debates in the Colombian legislature. Heading into 2023, passage of the initiative appears likely given as it was approved with ease by both the Senate and Chamber of Representatives in autumn 2022 and has been endorsed by several ministers and members of Petro’s cabinet. In October, 105 members of the Chamber of Representatives voted in support of the initiative, with 33 opposed.
“This is a bill that promotes peace,” Senator María José Pizarro Rodríguez said. “It benefits farmers and the indigenous and will help to relieve the over-crowding of national prisons.”
She added: “It’s time for us to apply a new logic to the fight against drugs in Colombia.”
Revision required?
Costa Rica’s cannabis industry took significant strides in 2022 with the approval of a law to legalise and regulate the production and use of industrial hemp and medicinal cannabis.
The legislation was passed and enacted in the spring. Regulation and guidelines for the hemp industry have been developed by the newly created Hemp and Cannabis National Technical Committee (CTN) of the Costa Rican Technical Rules Institute (INTECO), as have guidelines for medical cannabis. The CTN is now working on national standard requirements to ensure product quality.
Costa Rican business leaders and government officials have applauded legalisation, which they say will create substantial commercial opportunities in the Central American nation.
In November, the government authorised the first-ever cultivation and processing of industrial hemp in a 150-hectare farm in the northwest region of the country.
Like Petro in Colombia, shortly after Costa Rica’s new president Rodrigo Chaves took office in 2022, he too advocated the legalisation of recreational cannabis and submitted a bill to the Legislative Assembly in the autumn.
However, despite legislative support for the initiative following the legalisation of medicinal cannabis and hemp, the recreational cannabis bill has been criticised by Congress members and government security forces for being imprecise. While the bill is expected to be debated in the Legislative Assembly in early 2023, it may require revisions or redrafting in order to be considered for approval.
Regional outlook for growth
2022 was a generally positive one for medicinal cannabis in Latin America, as Argentina and Panama passed legislation to regulate cultivation, sales and exports, Peru implemented regulation to oversee the nascent industry, and Ecuador recorded its first production of cannabis for medicinal use three years after passing a legalisation bill in 2019. Advances in regional medicinal cannabis and hemp legislation bode well for continued development of the young industries in the new year.
In Argentina, passage of the bill to cultivate, sell and export medicinal cannabis and industrial hemp in May, supported by president Alberto Fernández, has been celebrated as a growth opportunity.
However, the positive forecasts of industry growth for 2023 in the country are increasingly fading after the government failed to meet the deadline to issue the regulations further developing the law. The government might issue those regulations in 2023.
The same applies in Panama, where president Laurentino Cortizo, when approving the decrees to implement regulation for the medicinal cannabis industry in September, expressed interest in “the establishment of local and foreign companies to supply the internal market using raw materials produced in Panama”. The small Central American nation of 4.5m is likely to continue to develop and invest in its medicinal cannabis market in 2023.Gerd Altmann
Peru unveiled regulation to govern the medicinal cannabis market in November, a move which should lead to development of the industry and allow for cultivation, research, imports and sales of the plant and its derivatives. However, implementation in the short term is likely to be complicated in early 2023, with huge political unrest and uncertainty following the ousting of president Pedro Castillo last month.
Ecuador, which approved legislation to legalise cannabis for medicinal purposes in 2019, began to see incipient market growth in 2022, which is likely to continue in 2023. The country approved production of its first government-regulated medicinal cannabis plants in March and, in July, the company CannAndes recorded Ecuador’s first hemp export to Europe. The country seems well positioned for further development of the medicinal cannabis and hemp industry in years to come.
An unenthusiastic president
In Mexico, experts tell CannIntelligence they are pessimistic about advances in a recreational cannabis bill, which has stalled in Congress, and over growth in the medicinal cannabis and hemp industry in 2023. Uncertainty in the industry is likely to persist.
Entering the final full year of his administration, Mexican president Andrés Manuel López Obrador, who has shown limited interest in advancing cannabis legislation, is unlikely to seek to develop the medicinal cannabis or hemp industry or push for approval of the bill to legalise recreational use. Even companies that have been granted injunctions to cultivate hemp, such as Xebra Brands, continue to face legal obstacles to operate in the country.
In November, a coalition of parties and civil society groups presented a bill in Paraguay that seeks to regulate the use of and cultivation of cannabis. The bill, supported by senators from the opposition party, calls for the decrminalisation of cannabis possession, the creation of a National Cannabis Institute, and the development of a regulatory framework to oversee its production.
According to text of the bill, cannabis legalisation would generate economic opportunities, create jobs in the medical and agricultural industries, and reduce arrests and legal costs for the government.
On 12th December, the Paraguayan Congress held a public forum to discuss the initiative, which was widely attended by members of the national agriculture industry, who support the proposal. While the bill may be debated further in 2023, it comes from a minority party and it is unclear whether the majority of Congress will view it favourably enough to pursue it further.
– Adam Williams CannIntelligence contributing writer
Artwork: Gerd Altmann
