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American marijuana businesses are against Mexican cannabis being added to the Nafta: Here’s why

NAFTA negotiations are continuing this week, and the former President of Mexico has some strong views on why Mexican cannabis should be introduced into the North American Free Trade Agreement.

As a long-time advocate of cannabis legalization, former president Vicente Fox argued that it will help to win the long-standing battle against the Mexican drug cartels. In a recent interview, Fox also drew attention to the economic benefits for Mexico if cannabis was introduced into NAFTA, stating “We can change criminals for businessmen, we can change underground, illegal non-taxpayers into an industry, a sector of the economy”.

Fox would have a lot to gain from cannabis being included in the NAFTA, as he currently sits on the board of Khiron Life Sciences Corp., a medical cannabis producer based in Vancouver.

Medical cannabis has been legal in Mexico since 2017, and Fox expects recreational cannabis to become legalized by 2019.

If cannabis was to be introduced into the NAFTA, legal cannabis production could provide a huge boost to the Mexican economy as it becomes a major export to the Canadian and U.S. markets.

So why are so many people in the American marijuana industry against the idea?

The import of foreign grown product could have serious ramifications for America’s fledgling cannabis market. If cannabis was added to the NAFTA, it would be treated just like any other produce export - like kale or avocados. The problem is, cheap Mexican cannabis could flood the U.S. and Canadian markets to such an extent that small local business can’t keep up and get priced out of the market as a result.

Mexican fruits and vegetables currently provide up to 70% of the Canadian and U.S. market, so it’s no wonder that many small cannabis businesses in the U.S. are worried that Mexican weed could dominate the industry.

In California, many small manufacturers and cultivators are already struggling with the state’s extensive regulation and constantly shifting legal framework. Small-business owners are looking to protect industry jobs, as well as the promise of future jobs that will be created from increasing legalization across the country. Lex Corwin, the founder of Los Angeles organic cannabis producer Stone Road Farms, has highlighted the issue of introducing cheaper, foreign-grown product into the American market, stating “if we add foreign-grown, low-cost marijuana to the equation, it would be a death sentence for many American marijuana businesses and the tens of thousands of well-paying jobs this industry provides”.

While the future of Mexican cannabis import is still up in the air, NAFTA negotiations will continue this week as the U.S. and Canada try and reach a deal for Canada to remain part of the three-nation trade agreement with Mexico. Mexico and the U.S. managed to strike a deal last month, and are now hoping that Canada will sign on.