Canada drug legalisation will open a new industry

Subject

Cannabis legalisation in Canada.

Significance

International alcoholic drinks giant Constellation Brands yesterday announced a 4-billion-US-dollar investment in Toronto-listed Canopy Growth, which will give it a 38% stake in the leading Canadian cannabis grower. Canada is on track fully to legalise cannabis on October 17. Canopy says the funds will be used to develop its business in the nearly 30 countries pursuing legal medical cannabis and to prepare for future global recreational cannabis markets, notably in the United States.

Impacts

• A Canadian export market for cannabis is possible once more countries make cannabis legal.
• The likely provincial government revenue spike could help tackle public debt, while funding public services.
• The current domestic medical market for cannabis will likely be reformed or abolished now that the drug is being legalised nationally.
• Many Canadians consume cannabis, yet polling indicates that the drug’s legality is unlikely to lead to much new consumption.
• Legalising cannabis will also see businesses that produce cannabis-infused edible products expand.