An Education on South American Geography

Uruguay has joined the ranks of the Netherlands, Washington, Colorado, and North Korea in ending an 80 year prohibition on the production and sale of cannabis.  In a 16 to 13 vote this country on the southeastern border of Brazil becomes the first nation to fully legalize and control the production of the controversial plant.  From a business stand point, it sounds like a great idea.  It sets the country up as the only legal regional producer for a plant that can be used in a variety of ways including: industry, building materials, textiles, food, medicine, and agriculture.  The plant is cheap to grow for industrial purposes and fits well into a crop rotation system.  This new law allows Uruguay to effectively corner the cannabis and hemp markets in South America and perhaps globally by allowing cheap legal production of a wide variety of cannabis based goods.  These goods while legal to sell in the majority of the world, are illegal or difficult to produce elsewhere in the world.  From a business stand point, Uruguay is setting itself up to corner a market. From a political standpoint, it is the best time for Uruguay to make the move.  With recent legal changes in Washington and Colorado, the US is left in a precarious situation regarding international drug policy enforcement.  With “legal” cannabis production in a few states, the US has run afoul of the UN mandates on the growth and sale of cannabis.   Just a few years ago legislation disobeying an international drug policy mandate would have brought a swift crack down from the United States.  With recent legal challenges, the US is now effectively kept from exerting political pressure on the South American nation, leaving its government free to exercise their sovereignty. From a social stand point the legislation gets even more interesting.  Uruguay’s government intends to curb the grip of drug traffickers and illegal cannabis sales within its borders.  This new law allows the government to undercut the black market prices by thirty percent and allow market forces to push illegal sellers and producers out of business.  The result will likely be decreased crime and an increase in jobs and tax revenue from the newly legalized industry. Uruguay’s experiment into legal cannabis production should be looked at for what it is, an experiment.  An experiment that is interested in taking money out of the hands of criminals and putting it into the hands of the people.  Uruguay is taking a risk to give themselves an international advantage in industrial and medical production from a previously taboo plant.  Whether it will pay off or not remains to be seen, but Uruguay appears to be positioning itself for success.  If anything else, it will give recreational users an education on South American geography.