What Are The Implications of New Zealand's Cannabis Referendum?

Tomorrow is the final day to vote in New Zealand's cannabis referendum. But what does this mean?

If you haven't been paying attention, New Zealand has a referendum tomorrow on adult-use recreational marijuana legalization, which asks citizens:

"Do you support the proposed Cannabis Legalisation and Control Bill?"

New Zealander's can then give one of two responses to the question, which is either "Yes, I support the proposed Cannabis Legalisation and Control Bill" or "No, I do not support the proposed Cannabis Legalisation and Control Bill".

In the lead-up to the election, polls have oscillated frequently between a slight majority either in favour of or against marijuana legalization, suggesting that the upcoming referendum rests upon a knifes edge.

All of this begs the question, will New Zealanders vote yes on the referendum? And what happens if they do?

The Referendum and General Election

Firstly, it should be mentioned that the referendum is non-binding, meaning that it's more of a litmus test to see how New Zealander's feel about marijuana legalization, with no actual legal requirement for the Government to implement the voters' wishes.

That said, the marijuana referendum is occurring on the same day as the General Election, in which New Zealanders will vote on which Government they want to govern for the next few years.

This is particularly important because the election is between Jacinda Ardern and the centre-left Labour party, and Judith Collins and the centre-right National Party.

As it stands, while Jacinda Ardern hasn't stated her personal position on the matter, she has admitted to smoking cannabis previously and has "assured" citizens that her party will honour the results of the marijuana referendum.

Conversely, Judith Collins has stated her party will vote "no" at the referendum, and hasn't made it clear whether her party would honour the results of the referendum, should she be elected into power and should the referendum receive a majority yes vote.

This means that the legalization of cannabis in New Zealand hinges not only upon the referendum itself, but also potentially upon the party that is voted into power on the same day.

A Pro-Cannabis New Zealand

Right now, it's anyone's guess where the majority of votes will go on October 17th for both the General Election and the cannabis referendum.

However, let's imagine for a moment that New Zealand does legalize adult-use recreational marijuana. What would that look like?

The proposed cannabis law, if passed, would allow New Zealanders to buy 14 grams of cannabis a day, and grow up to two plants. Moreover, according to reports by the research group Business and Research Ltd, (BERL), New Zealand stands to gain up to 5,000 jobs, and up to $1.5 billion worth of annual cannabis retail value, at $20 per gram.

Of course, this is based on an estimated 74 tonnes of cannabis being purchased on the existing illicit black market, which is currently being utilized by citizens as young as 15 years old.

In reality, the legal, regulated market would be limited to those aged 20 and up, and many people would be likely to purchase more than one gram at a time, thus lowering the cost per gram – therefore $1.5 billion may be a bit of a stretch.

However, there are also roughly 1,115 hospitalizations from cannabis misuse each year in New Zealand, costing the country just shy of $15 million per year. As cannabis education increases and the stigma surrounding the plant dissipates, it's likely hospitalization will decrease after several years of legalization.

Following Canada's Lead

While New Zealand has only roughly an eighth of Canada's population, Canada's cannabis market nonetheless provides a useful roadmap for countries who would like to similarly legalize cannabis on a federal level.

In particular, there are many lessons in what not to do when it comes to Canada's approach to cannabis, such as:

  • A lack of brick and mortar stores
  • Supply issues (first there wasn't enough cannabis, then there was too much.)
  • Cannabis was too expensive, leading to a persistent black market
  • Excessive Regulations

Should New Zealand indeed implement an adult-use recreational market for cannabis, the party in power would be wise to consider the obstacles faced by Canada and seek to mitigate them.

However, despite all of these issues, Canada's cannabis market is expected to be worth $4.1 billion in 2021 by the Canadian Imperial Bank of Commerce, and the black market continues to shrink each year.

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Louis O'Neill
Louis O'Neill

Louis is a writer based in Sydney with a focus on social and political issues. Having interviewed local politicians and entrepreneurs, Louis now focuses on cannabis culture, legislation & reform.

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