On the eve of cannabis legalization in Canada, our Toronto office’s Managing Partner & Chief Digital Strategist, Rick Murray, pens an open letter to Prime Minister Justin Trudeau: with so many questions left unanswered, how will the cannabis act impact our country, our economy, our people? The world is watching.
Tomorrow is a big day for your administration. Canada will become the first country in the G20 to legalize recreational cannabis.
That being said, ever since you proclaimed this to be a priority for your government, the cannabis industry has left many other burgeoning sectors in the dust.
Consider this – as of today, the top three LP’s (Canopy Growth, Aurora Cannabis, Aphria) have a combined market capitalization in excess of $31B. Every one of them now ranks as a top 100 publicly traded company in our economy. This despite the fact that their combined past four quarter revenues total a mere $180M. Some say we’re creating a global industry; some say we’re creating a massive bubble.
The hope and promise of Bill C-45 goes beyond a desire to make legal something that is, according to many and when consumed responsibly, no more or less harmful to one’s health than alcohol. The promise includes the creation of a significant new tax revenue base and a dramatic reduction of the black market for cannabis across the country.
As the first legal sales of recreational cannabis take place tomorrow morning, the reality is that there are myriad of unanswered questions.
- How big is the market, really? Once the novelty wears off, where will consumer demand plateau?
- With the experience from Colorado and other US States as guideposts, the majority of the industry expects that supply will exceed demand by the end of 2019 or in early 2020. What will that do to wholesale pricing? What will that do to the tax base?
- How will Health Canada (among others) react to those LP’s who use their imaginations to test the outer limits of the rules that state how cannabis can be marketed and promoted? Is Ottawa prepared to react swiftly and decisively to what will likely be a tsunami of violations and complaints?
- How will companies adapt their employment policies, and how can employers police those without violating employee rights?
- What new suits will this bring on the Courts?
- Are police and the RCMP adequately prepared? (I think we know the answer to that one: an emphatic “no”.)
Tomorrow is a momentous day to be sure. For those who choose to consume cannabis, you may have just made April 20 meaningless from here on out. Even for those who don’t – here and abroad – you’ve reinforced once more that Canada is a forward-thinking, forward-acting country. The world does need more of that from Canada and others.
But this law/act, and the industries it has birthed, must and will evolve over time to reflect the realities as they emerge lest it all go up in smoke. How we do that… how quickly, empathetically and effectively we all do that… will define how this decision, and this day are judged in the long run.
Here’s to the future!