Toward the end of last year, we reported that the Israeli parliament had passed a bill permitting local companies to export medical marijuana. However, there were fears that the cabinet may wait until after elections before pronouncing itself on this matter. It turns out that those concerns were premature because the cabinet has given its approval and cannabis firms can start processing the necessary paperwork to sell medical cannabis abroad.
The cabinet’s decision leaned on the recommendations made by an inter-ministerial committee (finance and health ministries) that was tasked with studying the Act of parliament and then advise the cabinet on the matter.
The committee took note of the advanced research, technology and regulatory capabilities of the country as major advantages that would make Israeli medical cannabis competitive on the world market.
The worldwide medical cannabis market is growing rapidly from an estimated valuation of $8.3bn in 2017 to about $28bn by 2024. Medical cannabis exports would earn Israeli firms about $1.09bn each year.
The Ministry of Finance agreed to channel some of the money earned from cannabis exports to the Ministry of Health.
Currently, there are eight companies that grow medical cannabis in Israel. The approval of exports is good news to them because the domestic market wasn’t large enough to sustain these producers as well as those who are still queuing to get licenses.
Medical cannabis exports will be tightly regulated since cannabis is a drug that is subject to strict controls internationally. Israeli companies will get an export permit issued by the Ministry of Health and approved by the police. These companies will then export medical cannabis to other companies in Europe. Those companies should have also obtained permits to import medical cannabis.
Israel is likely to enjoy several advantages when compared to other countries, such as Canada, that export medical cannabis. For example, Israel is closer to most European markets when compared to its competitors.
Secondly, Israel is renowned for having very strict regulatory systems and its research capabilities are famous across the world. This makes Israeli medical cannabis exports to have a good reputation on the market when compared to other exporters whose domestic regulatory mechanisms aren’t so rigorous.
As you can see, different countries are positioning themselves to control a large share of the international medical cannabis market. The question is, when will the U.S. wake up and catch up with the other countries that are already active in the medical cannabis space? The sooner federal marijuana laws are reformed, the better for the U.S. cannabis industry. This speedy legal reform is what entities like Golden Developing Solutions, Inc. (OTC: DVLP) and Global Payout, Inc. (OTC: GOHE) have been hoping to see for years.
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