Mexico could become the world’s largest cannabis market

In 2017, medicinal cannabis was legalized in Mexico. On March the 10th, 2021, the Chamber of Deputies approved a bill that would turn Mexico into the biggest cannabis market in terms of population (129.000.000 people). Mexico could join Uruguay and Canada and become the third country to fully legalize cannabis.

Medical marijuana would be regulated separately by the Health Ministry.

Mexico’s cannabis bill project

If approved by the Senate, this bill would legalize recreational marijuana. It would allow small and corporate growers to produce and sell the drug under specific licenses. Indigenous people and small farmers would be granted priority in licensing.

As for users, possession would be permitted up to 28 grams. Small growers could have up to 6 plants per household. There would be licensed cannabis clubs with a maximum of 20 members, 4 plants per person allowed with a maximum of 50 plants in total within the same group.

Companies selling recreational cannabis would have to follow specific packaging rules: labels must be clear announcing that goods would only be sold within the borders of Mexico and there should be health warnings like those on cigarette packaging. Those packages should also be kid-proof.

The struggle to legalize cannabis

• During the 1980s the drug black market and other crime groups became organized in Mexico. Once the production increased the different organized crime groups began fighting for territorial control, generating violence across the country.

• In 2006, the Mexican government declared the war on these criminal organizations using military force. This war keeps leaving concerning data: 300.000 deaths and 66.000 disappeared.

• In 2018, The Supreme Court ruled that the ban on recreational marijuana was unconstitutional and recreational cannabis became decriminalized.

• Cannabis still represents stigma and taboo amongst Mexican citizens and according to research (in Spanish) 58% of Mexicans are against legalization.

The impact on Mexican economy

The current Mexican marijuana industry could be worth about 3.2 billion dollars annually. Could cannabis be the financial lift for Mexican economy after the COVID-19 crisis?

Here’s two different opinions: Erick Ponce, president of the Cannabis Industry Promotion Group, said that the cannabis industry “is going to finally generate income in terms of employment, in terms of the local economy, in terms of taxation”.

However, Harvard University’s economist Jeffrey Miron said that “it’s hard to see any obvious broad effects on the Mexican economy. You will see a little bit of a bump in measured G.D.P., but people claiming that it will be a big boost to the economy through legalization, I don’t think that makes sense at all.”

Will this regulation end drug wars in Mexico?

Unfortunately not. With a growing amount of American states legalizing marijuana, cannabis has become a small part of the Mexican trafficking business. Cartels are focusing on much more profitable drugs. Mexican drug cartels are the main suppliers of cocaine, heroin, fentanyl, methamphetamine and other illicit narcotics to the United States. Heroin and methamphetamine is produced in Mexico, while cocaine is transported from Colombia by Mexican criminal organizations. The amount of seized fentanyl by authorities nearly quintupled between 2019 and 2020.

This is why security experts agree that the impact of this new bill on drug-related violence would be minimal. For instance, kidnapping or extortion don’t require the logistics of drug trafficking. This evil deviation of business keeps cartels running and the drug wars going.