Colombian President Iván Duque signed a decree on Friday lifting a ban on exports of medical cannabis flower, swinging open the door to the global cannabis industry.
“Colombia will start to play big in the international market,” Duque said, as he presented the decree, accompanied by several of his ministers.
The signing event was organized by Clever Leaves, a multinational cannabis company, and held at the company’s forty-two-acre cultivation facility in Boyacá in the Colombian Andes.
Since 2016, Colombia has had a legal framework that allows the cultivation, manufacture, and export of cannabis-based products for medical use. But the export of cannabis flower had been banned. Until now.
“By prohibiting the export of dried flowers, the government was trying to encourage the technical development of the pharmaceutical industry,” cannabis business consultant Santiago Restrepo told Cannabis Wire—incentivizing companies to process the plant and then export value-added products. “The problem,” Restrepo said, “is that Colombia does not have the capacity to develop a pharmaceutical business.”
Cannabis companies with cultivation licenses in Colombia had long been asking the government to issue the decree. “We embrace the possibility of exporting dried flowers, an industry in which the country is highly competitive, and this will allow companies to speed up their business plans and generate income in the short and medium term,” Cesar Diaz, director of the Colombian Chamber of Medicinal and Industrial Cannabis, told Cannabis Wire.
In addition to the export of the dried flower, which is the most significant shift, the decree also allows for the processing of cannabis flower into medicines in the Free Trade Zones located inside the country, which would allow the companies to obtain tax benefits. And, it allows CBD to be included in food products.
“We are no longer only in pharmaceutical use,” the president said. “We are opening the space to do much more in cosmetics … food and beverages.”
The decree could position cannabis to join the ranks of the country’s main export products, including coal, flowers, and coffee.
Restrepo says that good geographical conditions—mild temperatures, fertile soil, an abundant water supply, and long days—along with cheap and highly skilled labor, makes the country ideal for the cultivation of the plant.
The government estimates that the move could give a boost to the economy in the wake of a devastating pandemic. At the signing ceremony, Duque said that medical cannabis in flower form “represents 53 percent of this market worldwide.” And, he noted, other countries in the region, like Uruguay and Mexico, already have or will soon have “a regulatory framework to participate in this sector.”
Fedesarrollo, a Colombia based economic and social policy research institute estimates that one hectare (almost two and a half acres) of legal cannabis produces seventeen jobs and, before the pandemic, the institute saw export revenues from the cannabis industry bringing in $109 million (USD) to Colombia in 2020.
The government decision opens new markets to companies that have been cultivating the plant for years in the Latin American country, including Khiron and Pharmacielo.
“We will have export potential, for example, to Germany, Asia, Oceania,” the Colombian leader said.
Still, Restrepo wonders what took the government so long to open this door. As Cannabis Wire reported, reform for non-medical uses of cannabis has faced resistance from Duque’s political faction and the government has been slow to remove the cumbersome bureaucracy involved in obtaining licenses and paperwork for medical cannabis.
“There are many investors who were disillusioned with Colombia, putting money in, and the industry did not take off, so I think there is skepticism,” Restrepo said. “The real enthusiasm will come when we see the exports.”