How has COVID-19 Affected Cannabis Markets?
Global cannabis market escapes coronavirus pandemic
COVID-19 has disrupted many industries, but the cannabis market seems immune to the global coronavirus pandemic. Technavio’s Global Legal Cannabis Market 2020-2024 indicates that the global cannabis market is expected to grow USD 27.89bn this year, far surpassing 2019 predictions. This is a big deal considering the coronavirus outbreak in the first half of the year.
Cannabis market growth surpasses last year’s predictions, despite COVID-19. img src
New Zealand handled COVID-19 quite well. The government shut down all borders and entry ports in March, with returning citizens and residents being ordered to self-isolate for two weeks. In fact, the entire country was ordered to quarantine at home, except essential workers.
As a result, the country was able to get rid of the virus, recording several weeks of no new coronavirus infections - a feat that other developed countries have found nearly impossible to accomplish.
However, the strict restrictions had economic impacts that New Zealand will have to cope with for a while. And other countries around the world that also took similar steps and implemented strict restrictions are dealing with similar economic issues.
But while economies and other industries suffer, cannabis markets grow. Let’s take a look at how this might be great news for the New Zealand if the upcoming October referendum results in lelising recreational cannabis.
The October referendum on the Cannabis Legislation and Control Bill
On 17 October, New Zealand will become the first country to allow citizens decide whether cannabis should be legal. Citizens will vote Yes or No on the Cannabis Legislation and Control Bill, alongside the general election.
The bill will allow Kiwis who are 20 years and above to:
- Purchase up to 14 grams of cannabis from licensed dealers
- Grow up to 4 cannabis plants per household
- Consume cannabis on private property or areas that are licensed for cannabis consumption
- Share up to 14 grams of cannabis with others who are 20 years or over
The bill also has a number of restrictions aimed at maintaining cannabis quality in the country, promoting health and reducing or preventing risk:
- No public cannabis smoking, except in licensed areas
- No cannabis beverages
- No edibles or concentrates for now, but perhaps in the future
- THC content cannot exceed 15%
- No cannabis advertising
- Business must choose between selling and cultivating cannabis - not both
The bill is quite detailed on several fronts, giving citizens a transparent approach to how, exactly, cannabis will be regulated if they vote Yes in October. For instance, Kiwis caught with cannabis while under the age of 20 will not face jail time, but rather a fine or a educational/health-based response.
However, those who are caught selling cannabis to people under the age of 20 will face up to 4 years in prison, while those caught dealing without a license to any person of legal age or not will face up to 2 years in behind bars.
Tax revenue from the cannabis will help New Zealand recover from COVID-19 economic effects
According to economists, New Zealand could benefit $490 million in tax revenue just one year after legalising the crop. With the coronavirus restrictions reeling the country’s economy backwards, such revenue must be welcoming news - if the majority vote Yes.
Legalising cannabis will also mean that police will focus on other crimes - actual crimes. Such a scenario will free up law enforcement resources significantly, including the courts, easing their budgets and leaving even more money for other important sectors.
But none of this will be the case without cannabis reform. In order for the Cannabis Legislation and Control Bill to be considered, 51 percent of the votes in teh referendum would have to be Yes. Further, the bill is not binding - it would still have to be considered in parliament like every other bill before it becomes law.
But with the Labour, NZ First, and the Green Party all indicating their support for the bill if the majority of New Zealanders vote Yes on 17 October, parliament is unlikely to block the bill from becoming law. That is, of course, if the National Party does not become the majority after the general election, as they have not pledged their support for cannabis reform.
Final words - Vote for Yes cannabis legalisation
We’ve waited for the referendum for a while, and now it’s just a month and half away. But without your vote, this important step in history might go the wrong way.
The coronavirus pandemic has caused some major economic damage across the globe, and New Zealand is no exception. With significant tax revenue expected from the cannabis market if legalised, the country will benefit greatly.
But the cannabis bill isn’t all about money - it’s about health and risk prevention. The restrictions in the bill ensure high quality control, health and drug education for users, and strict regulations for companies looking to enter the legal cannabis business in the country. To see it all come to fruition, vote Yes on 17 October.