Once unthinkable, legalizing the consumption and sale of cannabis is now rolling out across Europe – and brings with it a plethora of business opportunities
While currently only legalized for recreational purposes in Luxembourg and Malta, many countries where cannabis consumption is already legal for medical purposes are most likely to break through the next barrier. Germany, for example, recently announced its plan to legalize cannabis fully; that could get drawn up by the end of summer. Indeed, Health Minister Karl Lauterbach has stated the dangers of non-legalization of recreational cannabis outweigh the risks of legalization.
Coincidentally, London mayor Sadiq Khan recently launched a commission to examine the effectiveness of the UK’s drug laws, with a particular focus on cannabis. This shift in focus is not only essential from a justice perspective, putting an end to decades of unnecessary arrest,but also the economic future of countries considering it.
An Unmissable Opportunity
Look at places where cannabis is legalized and see the great opportunity it provides.
Since Canada legalized recreational cannabis use in 2018, the industry has added billions of dollars to the country’s gross domestic product and has created over 150,000 jobs. In 2021, Colorado collected more than $423m in tax revenue on sales worth over $2bn after legalizing cannabis for recreational purposes.
Estimates in Europe show its total cannabis market could be worth $37bn by 2027. The markets expected to contribute most to legal spending are Germany, the UK, and France. As legalization rolls out across Europe, that potential market could grow even larger. And in Africa, it’s estimated that the legal cannabis industry could be worth over $7bn by 2023. It’s clear that cannabis legalization makes good business sense for national governments and comes with significant opportunities for businesses too.
The Right Approach
But for that opportunity to be truly effective, companies must take the right approach. That requires building an industry that respects the environment, the communities it serves and produces in, and good corporate governance. The pitfalls of failing to do so could be enormous. Fortunately, it’s possible to take a more considered approach to the impact of this work.
It’s what we did at Akanda from the beginning. Our recent acquisition of Holigen, a Portugal-based cultivator, manufacturer, and distributor, provides us with both the capacity and route-to-market for delivering EU-GMP-certified medical cannabis to legal EU markets. Adding to our existing medical cultivation facility in Lesotho, Southern Africa, gives us access to year-round production, enabling us to fulfill a consistent seed-to-patient model. Beyond that, it provides valuable employment in areas where it’s needed while growing according to strict environmental regulations.
It’s also critical that the industry conforms to all medical regulations. The UK and Europe industry players must follow and comply with over-the-counter or behind-the-counter medicine regulations in a pharmacy. It includes safety standards and testing to create a consistent product within a tight range of variables – they must be shelf-life stable, similar to that of a box of paracetamol. It should hold for governance among companies in the space. With the appropriate oversight structures in place, the cannabis industry can ensure its contributions in countries where its use is legal; are positive.
Still Early Days
While legalization rolling out across Europe proffers much promise and opportunity, remember it’s still in its early stages. Many more countries will legalize cannabis consumption for medicinal and recreational use. Over time, laws will change too. It’s imperative that the cannabis industry adapts to those shifts and changes and does everything in its power to act as a force for good.