Global Ganja Report

From the the "Tulip Mania" in 15th century Holland to the Bitcoin bubble of 2017, high hopes for a commodity's market performance can lead to unsustainable overvaluation inevitably followed by a painful correction. Many observers believe that cannabis fell prey to this phenomenon in 2018—but are hoping for growth in a more rational and realistic market in the coming year.

Cannabis has become a global industry, but obviously it is still limited by legal restrictions—and the fact that these increasingly vary from country to country further complicates things. Where is commercial cannabis going and where is it coming from? And how is this likely to change as the international atmosphere further liberalizes?

An international network of non-governmental organizations has submitted a "shadow report" to the United Nations, calling the war on drugs a "spectacular failure"—and calling on the world's governments to reconsider it. The report takes heart from the growing official tolerance of cannabis in several countries around the world, but warns of escalating and horrific repression in the name of drug enforcement in several others. Will the UN take heed when it revisits the question of drug policy in 2019?

Over the past two years, the Latin American cannabis industry has "emerged from the shadows" to command the attention of international firms and investors. Legal cannabis sales within the region are on track to reach $125 million in 2018—but that figure is expected to rise to $12.7 billion by 2028.

As the UN General Assembly met in New York, President Trump issued a "Global Call" to renew the war on drugs—to the dismay of activists and dissenting nations. But the UN itself has a contradictory cannabis policy—with some agencies recognizing its efficacy as medicine and others backing the prohibitionist doctrine of the Single Convention treaty.

Lesotho is a land-locked mountain kingdom in Africa that few in the outside world have heard of, but it punches above its weight where cannabis production is concerned. "Dagga" has long been a pillar of its economy. Now it is attracting international investment to grow cannabis for the global medical market. With cannabis just decriminalized in South Africa—which borders Lesotho on all sides, and is closely integrated with the kingdom—this is a promising sign for the entire region.

With Canada now joining Uruguay as the second country to legalize cannabis at the national level, industry eyes are scanning the world map for which could be the likely third. Latin America may provide the candidate, as even UN experts now urge the region's governments to consider legalization as a way out of the endemic narco-violence. But pressure for legal cannabis is fast mounting in several European countries as well. Legalization may soon be on the legislative agenda in Australia, while New Zealand has promised to put the questions before the voters. 

A year after legal cannabis first went on sale in Uruguay, it is still only available at a small handful of pharmacies. One particularly ironic obstacle has emerged: Uruguay's banks face US sanctions under the Patriot Act if they do any business with the country's legal cannabis industry. So a measure passed by the US Congress to crack down on criminal and terrorist networks that use drug profits is actually helping to keep cannabis under the control of criminal networks.