WHO Recommends Cannabis Rescheduling: How Has COVID-19 Changed The Cannabis Industry?

The global COVID-19 pandemic has triggered a domino effect of economic downfall, industry collapse, and a world-wide state of declaration: things need to change. Does the upcoming UN vote mean we are closer to global policy reform than we think? 

In 2019, the World Health Organisation (WHO) recommended to the United Nations (UN) that the current global scheduling of cannabis needs to change. In doing so, this will spark a complete transformation of the international trade, legislation, and economy revenue.

The upcoming UN vote, currently scheduled in December 2020, will decide upon whether cannabis should be considered more as a multi-functional plant-based product rather than a harmful drug.

Now, with a pandemic devastating international economies, the timing of the UN decision appears to be the advantageous jolt that countries like the U.S. needs.

This begs the question: what does the UN vote mean for the global cannabis industry and how can COVID-19 help?

What Is the Current Situation?

Currently, under the Single Convention of Narcotic Drugs treaty of 1961, cannabis appears on the same calibre of heroin and cocaine. Under this global classification, cannabis has a dangerous potential for abuse while having no medicinal benefit. Under the Single Convention, the Commission of Narcotic Drugs (CND) is responsible for regulating international narcotic laws.

The Single Convention internationally prohibits the production and supply of a schedule of drugs. Cannabis has remained under this classification since 1961; its only exemption is its use for medical treatment and clinical research.

Under the Single Convention, sovereign's can cast independent federal and state laws. The U.S., for example, passed the Controlled Substances Act (CSA) in the 1970s.

The CSA also stems from decades of anti-drug propaganda, associating cannabis with racial and cultural minorities. Under the Act, cannabis was classified as a Schedule I drug "with no accepted medical use and a high potential for abuse". It has remained this way for the past fifty years.

Why Is The UN Vote So Important? 

The UN is responsible for enacting international treaties in order to maintain "peace and security" around the world. The Single Convention recognises a global schedule of dangerous substances. This schedule sets a global standard for sovereign states to implement individual regulation programs and legislation.

The WHO systemises international health policy. Its recommendations are the catalyst behind UN policy reform. Naturally, its recommendation to reschedule cannabis means that countries can implement new legislation laws while allowing for international commerce.

In 2019, the WHO made several recommendations regarding the scheduling of cannabis under the CND: 

  • "Resin be deleted from Schedule 4 of the Single Convention on Narcotics Drugs (1961)".
  • Tetrahydrocannabinol (THC) should be "deleted from the Convention on Psychotropic Substances (1971) and added to Schedule 1 of the Single Convention on Narcotics Drugs (1961)."
  • CBD with extracts up to 0.2% THC should be removed completely from the schedule.

The UN has delayed taking action on the decision of the WHO's recommendations several times over the past two years. However, it looks as though the final vote will occur in December 2020.

What If The UN Votes Yes? 

Unfortunately, even if the UN accepted the WHO's recommendations, it won't mean that cannabis will become globally reformed. Cannabis still exists on the Single Convention, which means that restrictions on its use are still in place.

However, having CBD removed completely from the schedule will allow countries like the U.S. to sell, export, and import CBD products (containing up to 0.2% THC) freely across international borders.

This will mean a substantial boost for international commerce and creates further opportunity for countries to create, market, and endorse cannabis brands. Individual countries would still need to amend and implement importing/exporting legislation, however, overall CBD trade will be relatively easy.

With the exception of the removal of CBD from the schedule, existing cannabis laws would still be subjected to domestic regulations. The CSA, for example, would remain in place until legislation is modified through the senate.

Now, this creates a whole other host of obstacles. Laws aren't easy to change and the process is time-consuming. Furthermore, opposing political opinions, values, and beliefs are likely to contribute to the outcome of what kind of legislation is passed.

According to Forbes Magazine, if recommendations are successful, it could mean tighter restrictions, especially regarding specific THC content. This would mean that an international standard THC concentrate testing would need to be implemented and regulated. This would then allow government bodies to "monitor and report information to the UN." 

These changes will take years to complete and may well lead to stricter regulations, but the change will occur. 

As it stands, the global policy reform of cannabis is still a long way off. The catalyst, however, that is driving its acceleration appears to be mounted in the current pandemic. 

Can COVID-19 Contribute To Change?

For countries like the U.S., the UN vote creates opportunities for trade, commerce, and increased revenue. These opportunities may not have been as appealing before, but now, the impact of COVID-19 has made it almost impossible to ignore.

COVID-19 is just one of the movements of 2020 that begs the question: does the current system work?

The simple answer: no, it does not.

In fact, some experts are going as far as to say that this current recession has accelerated deregulation. For eighty years the U.S. government has rebelled against any usefulness for the cannabis industry with the exception of its medical benefits – however some states still enforce complete cannabis prohibition. Now, it's become a vital tool in revitalising an recessive economy.

COVID-19 has thrust the U.S., among other countries, into a revenue, tax, and employment recession. The cannabis industry, however, appears to not only be thriving but has become an essential commodity. In turn, cannabis legalisation will be driven by the need for job creation, commercial and tax revenue.

Cannabis remains an "essential" industry in 28 states during the COVID-19 pandemic. When states were ordered into a 'stay-at-home' lockdown, most dispensaries continued to produce and supply cannabis for medicinal and adult-use. Due to tight regulations, however, dispensaries were provided with no financial relief to cope with diminishing sales; a direct result from employment recession and stay-at-home orders.

The introduction of the SAFE Banking Act (SBA), however, will allow for cannabis businesses to work with banks and insurance companies. In turn, making it easier to access financial relief.

On a state-by-state level, initiatives are ongoing to qualify for electoral ballots for the general election in November 2020. Most recently, Nebraska collected 182,000 signatures in support of a medical marijuana program to be included in the states constitution. Mississippi is also campaigning for a medical marijuana initiative.

Colorado, on the other hand, turned over US$192 million in revenue for cannabis products in May, and received US$167 million in tax revenue last month. The cannabis industry also remains one of the leading job creators in the U.S.

How Will The Senate React?

In the case of the U.S., the pandemic and the upcoming UN votes will cause a tide of pressure to change their existing laws.

As it stands, past recessions has always induced a reinvigoration of an economy and COVID-19 is no different. If anything, the growing public support for cannabis legalisation and the current recession will only accelerate the demand for legalisation. The cannabis industry has become necessary to stimulate the economy. If the UN vote takes on the WHO recommendations, it will only add fuel to the fire.

In a panel hosted by Prohibition Partners LIVE, Aaron Smith, co-founder and CEO of the National Cannabis Industry Association, stated that one of the shortcomings of U.S. regulations is the divide between state and federal law. The outcome of this will be dependent on the general election.

Smith goes on to suggest that federal legalisation will likely be a change made by the democratic party. The republican party, however, will more likely keep regulations on a state-by-state level. Whether this will happen, however, remains to be seen. Either way, the movement is becoming harder to ignore. "It is becoming a bipartisan issue," Smith states.

As it stands, there is a need to seize any and all opportunity to accelerate the U.S. and global economy. The impact of the cannabis industry on the economic climate during the COVID-19 pandemic is one of the few things that grab the Congress's attention to implement change. As a result, cannabis legalisation is now turning into a "when" conversation rather than an "if".

What Will The Future Hold?

The UN vote will change cannabis laws, but not as much as we'd like. The most impact will come from eradicating CBD from the schedule entirely, creating a market for international trade and commerce.

Unlike the U.S., there are already sovereign states utilising the "medical treatment and research" exemption of the Single Convention treaty. Australia, Canada, and Uruguay are just a few examples that already regulate federal programs for medicinal cannabis. Although, it's nice to think that the U.S. will follow suit, this will likely depend on the outcome of the November election.

Deepak Anand, co-founder and CEO of Materia Ventures, says that the U.S. can learn from its northern neighbours about legalisation.

In Canada there's been a legal program…since October 17th 2018 and the sky hasn't fallen. We've created thousands of jobs, there's millions of dollars going into the economy… the U.S. needs to… consult with us around how cannabis policy can be implemented and legalised.Deepak Anand – Co-Founder and CEO of Materia Ventures

Even if the UN votes in favour of the WHO's recommendations, it will take time for individual countries to implement amendments to existing legislation.

If successful, the UN vote will set a new global standard for cannabis legislation. It will introduce new international markets, expand current import/export trade, and become a catalyst behind domestic policy reform.

These changes are still years from fruition. In terms of the international trade of cannabis for adult-use, it's even further. Yet, the COVID-19 pandemic seems to have fast-tracked the realisation that things need to change.

It won't happen tomorrow, but progress is progress.

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Taylor Ridewood
Taylor Ridewood

Taylor is a Sydney-based writer with a background in psychology and professional writing. She has a keen interest in the benefits of medicinal cannabis and enjoys researching the multi-faceted effects of cannabis on the body and mind.

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