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Germany's Cannabis Legalization: Will a Chain Reaction Take Place in the Rest of Europe?

Following Brexit, Germany's influence in Europe further consolidated. Beyond the weight of the German economy in the region, the country's decisions, innovations, policy, and industry are followed globally. Thus, the express decision of the German government to completely legalize cannabis in its territory opens the possibility for several countries to change their position regarding the plant, beyond the fact that cannabis expands towards a large market, with potential in a country with a worldwide recognized industry.

The statements by the German Minister of Health, Karl Lauterbach, arguing that cannabis consumption is already part of modern society, are encouraging. For Lauterbach, it is up to the government to promote cannabis use in moderation, in a safe and high-quality way, and without its acquisition representing a crime. The Health Minister recognizes that cannabis full legalization was a long-awaited decision in Germany and assured that a draft law will be ready by the end of 2022.

Previously, until the end of June, consultations were held with cannabis producers, health experts, and economists whose opinions will be considered to design the bill. Minister Lauterbach emphasized that one of the priorities in the document will be the protection of minors, trafficking, tax legislation, and the reforms to the penal code related to the plant.

Given Germany's economic and political weight in Europe, it is to be expected that its progress in this matter will motivate other European countries to take similar steps regarding the legalization of the adult use of cannabis. The director of the Düsseldorf Institute of Competition, Justus Haucap, agrees with this view: "There will be a domino effect, for sure". For the German director, what happens in Germany will be closely followed by countries facing problems due to the illegal cannabis market, such as France. The effects of cannabis legalization in Germany could even reach the United Nations, where its restrictive stance on cannabis cultivation could be reversed.

The Change Regarding Cannabis, Responds to Popular European Criteria

According to the German Minister of Health, his change of position and the bill do not correspond to an intention of seeking to expand cannabis consumption, but to protect minors and combat the indiscriminate use of cannabis. Lauterbach argues that the current repressive approach to cannabis has failed. In these circumstances, the risks are greater if restrictions are maintained instead of seeking legalization that controls consumption and contains impurities in the sale of cannabis. This premise explains the change of course in cannabis policy, a criterion shared by several European people.

In addition to its relevance as the largest economy in the European Union, Germany's clear desire and political will make it the leader of a path whose effects will have a positive impact on the rest of the continent, says Joe Bayern, CEO of Curaleaf. The German case is most striking because of its potential to become a highly profitable market for companies, investors, and governments. With cannabis full legalization in Germany, approximately 3.4 billion euros could be generated.

Besides the revenue potential, cannabis legalization is popular among the European population. According to surveys of more than 9,000 people published by Hanway Associates, 55% of respondents favored the sale of adult-use, government-regulated cannabis. Likewise, 48% of respondents favor regulated retail stores, 35% support home self-cultivation, and 32% favor social clubs. However, there is notable opposition to self-cultivation with 41% against.

Another way to explain the favorable view of Europeans towards cannabis could be how during the COVID-19 pandemic sales of cannabis and its derivatives skyrocketed in the United States, and became one of the few industries that did not contract during the pandemic. The trend in Europe is already well established, Luxembourg has already legalized its cultivation for personal use, while Malta was the first European country to fully legalize cannabis. Incorporating Germany, with all its potential, would consolidate a trend already established in Europe.

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