Argentina is in the process of passing new legislation that would pave the way for a medical cannabis and hemp industry in the country. While the law still has some way to go before it is passed, expectations are high. Many in the country see it as a closing window of commercial opportunity which could create thousands of jobs and generate millions of dollars for the domestic economy.
Argentina’s national government expects to have passed the law that promotes the development of the hemp and medical cannabis industry before the end of the year. The National Senate already has the draft bill that creates a legal and regulatory framework for commercial activity, which has been growing exponentially at a global level for the last two decades.
“In this emerging global market there is a window of opportunity for Argentina,” predicted Matías Kulfas, Minister of Productive Development, where the project germinated. The eventual law will allow the private and public sectors to cultivate cannabis for medicinal use and industrial hemp. However, the initiative does not advance the decriminalization of cannabis cultivation for recreational purposes.
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Argentina’s Not over the Line Yet, but the Support Is There
Argentina’s medical cannabis and hemp must now be dealt with in three Senate committees: Budget and Finance; Agriculture and Livestock; and Internal Security and Drug Trafficking. It is expected that the bill will be approved: governors from different political parties, such as the radical Gerardo Morales and the Peronist Alberto Rodríguez Saá, have already expressed their support to the bill. La Rioja, Entre Ríos, Neuquén (governed by the MPN) and Misiones also supported the bill.
“Will there be a law before the end of the year?”, this media asked Mara Brawer, deputy of the FdT. “I am convinced,” answered the legislator who contributed to the project an initiative of hers on the promotion of industrial hemp.
Contents of Argentina’s Cannabis and Hemp Bill
Article 1 states that the objective is to regulate “the chain of production and commercialization (national or for export) of the cannabis plant for medicinal and industrial use.” More than 50 countries have legislation on the production of medicinal and industrial cannabis.
Article 2 defines, among other terms, the scope of “cannabis plant,” and “hemp” as an industrial variety with a low content of tetrahydrocannabinol (THC), the psychoactive substance in cannabis.
The regulations of Argentina’s eventual law aim “to avoid diversions to the illegal market and to guarantee the traceability of processes and products for medicinal purposes”. It also establishes a sanctioning regime to guarantee the quality of the product, but, above all, to avoid diversion to the informal and illegal chain.
A Window of Opportunity for Argentina
The production of medical cannabis has grown exponentially since the beginning of the century. In 2000, 1.4 tons were produced in the world and, in 2019, production already amounted to 468 tons. By 2024, global production is projected at $42.7 billion. Israel, Canada, and the United States lead the table of producers worldwide; Uruguay and Colombia are the most advanced in the region.
“In this emerging global market there is a window of opportunity for Argentina,” predicted Minister Matías Kulfas, who maintains that the country can be a “global leader” in the production of medicinal and industrial cannabis, due to its experience in agricultural production, its scientific research network (CONICET created RACME, a unit that researches medicinal use), the experience of INTA and INTI, a network of public and private laboratories, and initiatives in several provinces.
Minister Kulfas outlined a “starting scenario”: by 2025 they project 10 thousand new jobs, some 500 million dollars in sales to Argentina’s domestic market, and 50 million dollars from exports. “A conservative scenario”, he clarified.
Regulatory Agency Announced, but Administative Questions Still to Be Answered
Argentina’s initiative would create the Regulatory Agency of the Hemp and Medical Cannabis Industry (ARICCAME), which will operate within the Ministry of Productive Development. The Ministries of Health, Agriculture, Science, and Security will be represented on its board of directors. This agency will regulate, supervise and administer the production chain; it will grant permits for production and commercialization; it will also apply fines or withdraw authorizations to producers who violate the law.
Regarding the integration of the Agency, there could be modifications to the text in the Senate. The governor of La Rioja, Ricardo Quintela, asked for a “federal integration”, with representatives of all the provinces.
There are 22 provinces and 80 municipalities in Argentina with different degrees of development in their projects. Jujuy, San Luis, La Rioja, La Pampa and Entre Ríos are at the most advanced stage. In the northwestern provinces, they intend to reconvert the tobacco sector to cannabis production. Chaco is also aiming at the reconversion of part of its cotton industry.
After Law 27,350 was passed more than three years ago, which enabled the medicinal use of cannabis in Argentina (but not its production), Jujuy took action. “We have invested more than eight million dollars,” said Governor Morales. A pilot plantation already yielded a ton of cannabis flower, which will be used to produce oil for medicinal purposes. “When we went to register the company to produce cannabis, the AFIP had no nomenclature; the importation of seeds was also not simple in administrative terms. This law will make the whole process less bureaucratic,” said Morales.
Entre Ríos is working on setting up a network of public laboratories for testing and quality control of medical cannabis in Argentina, and the government of La Rioja says it has invested “more than 100 million pesos to produce cannabis in the province”.
“Today, hemp not only serves the textile industry, but also for industrial fibers, auto parts, bioplastics and biofuels, construction materials, food industry, oils and infusions, and meets the requirements for sustainable development,” listed Congresswoman Brawer.
Governors Morales and Rodríguez Saá agree that, once Argentina’s law enabling the production of medical cannabis and industrial hemp has been passed, progress must be made in the decriminalization of the recreational consumption of cannabis. The governor of El Puntano invited to “break the paradigm and let’s talk about the decriminalization of cannabis consumption”.
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