—TRENDS—

10 years ago Uruguay broke United Nations laws to legalise the sale of recreational cannabis

Today, countries are beginning to follow suit

In this edition:

  • Science review: legal marijuana

  • History: Uruguay, Canada, United States, Malta

  • Business: largest cannabis companies

  • Forecast: who is next?

30 Dec 2023

Just the summary:

  • Legalising sale of non-medical cannabis meant breaking UN regulations for Uruguay in 2013 and Canada in 2018, but no sanctions were stipulated by the conventions

  • EU law sanction non-compliance with UN regulations, which prevented legalisation in Europe

  • Uruguay's President Jose Mujica saw legalisation as part of strategic solution to drug-trafficking and related violence

  • UN recognised therapeutic use in 2020, paving way for countries to adjust

  • Malta became first EU state to legalise adult-use cannabis in 2021

  • Germany is expected to legalise personal use in 2024, with Czech Republic and other states following

  • Academic studies of legalising cannabis had mixed results, some finding increased use in adults, but not adolescents, with rising instances of acute adverse symptoms, such as from ingesting edibles

  • Countries where recreational marijuana can be legally sold are currently limited to Uruguay and Canada, as well as a number of US states. 

  • Many other countries have legalised or decriminalised possession, use, cultivation or even sale in some form.

“This law is a trial. It doesn't mean we have the final answer. But our neighbours will have to take a look at our little country which might actually be a perfect location for this experiment. The only thing I'm sure of is that the policy of combating drugs which has been enforced for decades is a crashing failure. I'm glad we've kicked over the ant hill.”

- José Mujica, President of Uruguay in 2010-15

Uruguay changed the history of cannabis when it became the first country to legalise it in 2013, in contradiction to United Nations conventions on narcotics, destabilising the status quo of the prohibition policies pursued by other countries for decades.

"Cannabis legalisation in Uruguay was an important moment because it was the first country that ratified the UN 1961 Single Convention on narcotic drugs to do so, basically stating that [the convention] doesn't work anymore and Uruguay will be doing it in another way to combat drug trafficking." 

- Tom Blickman, drug policy reform expert at the Transnational Institute for Post factum

Legalisation in Uruguay was initiated by its then-president José Alberto "Pepe" Mujica who also legalised abortion and gay marriage during his mandate. He earned a media nickname of “the world’s humblest head of state” living austerely and giving up 90% of his presidential salary.

Mujica viewed cannabis reform as part of a strategic solution to address drug trafficking and related violence. From his perspective, the primary concern was the illegal drugs industry, not cannabis itself. 

Uruguay’s historic move has paved the way for Canada, which became the first G7 country to legalise non-medical cannabis in 2018, and Malta, which became the first EU member-state to do so in 2021, heightening the anticipation for wider legalisation. 

Inspired by Uruguay's example, legalisation movements promoted it as alternative to the hardline "War on Drugs" approach which often resulted in repressive cannabis policy at the expense of consumers, especially from marginalised communities.

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Legal status

The Single Convention on Narcotic Drugs of 1961 establishes the international legal framework for the war on drugs, with the goal of combating drug trafficking.

Uruguay in 2013 and Canada in 2018 have de-facto breached the Convention by legalising adult-use cannabis. However, the Convention has no mechanisms to sanction countries. 

The United Nations Office on Drugs and Crime is limited to sending letters to both countries regarding their contravention of the UN treaties, and these countries have responded by justifying their decisions to legalise.

European Union laws are different, however, providing for real sanctions on those member countries that do not follow supranational legislations.

Cannabis and cannabis resin were removed from Schedule IV of the Single Convention on Narcotic Drugs, paving the way for countries to adjust their regulations.

Since 2021, a number of states have cited the cannabis rescheduling in their rationale for cannabis reforms, including Japan, Spain, Morocco, Mauritius and Peru. 

However, sale of recreational cannabis is still prohibited by the UN. This resulted in Germany postponing its efforts to establish legal recreational market in 2023.

In 2021, Malta became the first EU state to legalise possession and growing of cannabis for personal use. In 2023 it was followed by Luxembourg.

Canada

Canada became the first G7 nation and the second country in the world after Uruguay to legalise adult-use cannabis in 2018.

Legalising cannabis aimed to eliminate the illicit market, enhance public safety, reduce crime, and ensure access to safe products.

Beyond addressing public health, the move proved economically beneficial, fostering a thriving industry that contributes significantly to the nation's economy.

The Canadian government's 2022 Cannabis Survey indicated a growing trend among Canadians purchasing cannabis from regulated suppliers rather than illicit ones.

United States

The United States is yet to legalise cannabis, but its state-level legalisation contributed more than anything else to changing the perception of cannabis regulation internationally.

While cannabis is illegal at the federal level and listed on Schedule I of the U.S. Controlled Substances Act (alongside most dangerous drugs like heroin), 24 out of 50 states and three U.S. territories as well as Washington D.C. have legalised it for recreational use, and 38 states - for medical purposes.

In 2022, U.S. President Joe Biden initiated a review of marijuana's classification, exploring the option of moving it out of Schedule I. However, notable progress in the effort to shift marijuana to Schedule III remains to be seen.

Cannabis industry in the US flourished in the last decade. The market is projected to achieve annual sales exceeding $31.8 billion by the end of 2023, with further growth to $50.7 billion in annual sales by 2028.

Industry

Alongside legalisation, cannabis consumption has undergone significant changes in the last decade since Uruguay legalised cannabis.

The traditional method of smoking dried flowers, has gradually been accompanied by other methods, including edibles, beverages, vaping, and dabbing.

2018 U.S. Farm Bill indirectly legalised the production of hemp, a term referring to cannabis primarily used for industrial purposes and containing a THC level below 0.3%. This has paved the way for non-intoxicating cannabinoids such as CBD, creating a flourishing global market.

U.S. cannabis multi-state operators have consolidated over the years, with several publicly traded. Some have also established a presence in Europe, where the potential market, particularly for medical cannabis, is highly attractive.

While Merger & Acquisition operations have recently experienced setbacks among big companies, they are still ongoing between small and medium businesses.

Academic studies

Research suggests medical cannabis legalisation increases adult but not adolescent cannabis use, and less regulated supply may increase adult cannabis use disorders.

These laws may reduce some opioid-related harms, while their impacts on alcohol and tobacco use remain uncertain.

Research on recreational cannabis legalisation is just emerging, but findings suggest little impact on the prevalence of adolescent cannabis use, potential increases in college student use, and unknown effects on other substance use.

Legalization of cannabis in Canada appears to have reduced cannabis arrests and increased access to a variety of more potent cannabis products at lower prices.

Since 2019, cannabis use in Canada has modestly increased among adults but not among adolescents.

There is evidence of increased instances of acute adverse effects of cannabis among adults and children, including accidental ingestion of edibles.

Forecast

"European legislation poses challenges, with EU regulations stricter and more enforceable. The focus on cannabis regulation centres on Europe, where obstacles exist due to EU laws. However, Luxembourg, Malta, Germany, the Czech Republic, the Netherlands, and even Portugal are moving toward legal regulation. In the United States, the potential rescheduling of cannabis under the Controlled Substances Act could influence European countries, making arguments against legalisation more challenging. The evolving U.S. landscape, with numerous states legalising cannabis, is shaping global perceptions. Republican voters, too, show majority support for legalisation. The potential shift in U.S. policy may challenge UN drug control conventions, potentially prompting more countries to embrace cannabis legalisation." 

- Tom Blickman, drug policy reform expert at the Transnational Institute for Post factum

Currently, countries with legal recreational marijuana are: Uruguay, Canada, Mexico, Georgia, South Africa, Malta, Luxembourg and Thailand. A number of other countries have legalised medical cannabis.

In the United States, the process toward federal legalisation does not seem to be stopping, as more U.S. states are poised to legalise adult-use cannabis in 2024.

Rescheduling of cannabis may become a matter of political debate in the 2024 Presidential elections, potentially influencing the opinions of single-issue voters.

The approval of the cannabis banking reform (also known as SAFE Banking Act) may receive green light in 2024, potentially easing access to financial services for cannabis businesses.

Germany, already the largest medical cannabis market in Europe, is expected to legalise cannabis for personal use in 2024.

The Czech Republic is also progressing toward legalisation, likely following Germany's lead and following the example of Malta and Luxembourg.

Interestingly, the Netherlands and Switzerland (the latter is not part of EU) have started pilot programs to experiment with controlled sales of legal cannabis, aiming to study the effects of legalisation on society.

Around the world, the situation regarding efforts to legalise adult-use cannabis is more mixed.

Colombia recently failed once again to legalise cannabis in the country, proponents may attempt another proposal.

Thailand may revert to a more restrictive policy towards adult-use cannabis, which was decriminalised in 2021, after a new government took office in 2023. 

Research and interviews: @Dario Sabaghi

Update: on January 8, 2024, Thailand’s new government has introduced a bill to amend current cannabis legislation in order to ban recreational use.

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