Canada Is Making Weed Legal Next Summer. Here’s How That Will Affect Their Economy

legal Canadian weed

It’s official: Canada is going green. On July 1, 2018, recreational use of cannabis will be legal throughout the entire North American country. Though medical use of the substance has been approved for well over a decade, Prime Minister Justin Trudeau announced that weed will no longer be subjected to criminal penalties and arrests as of next summer.

Trudeau’s announcement is yet another big step in the country’s often progressive stance on recreational drugs. Over a decade ago, the country permitted the first-ever legalized injection site for heroin users. This was created to combat overdoses, sharing of needles, and drug-related incidents in the Vancouver area. While legalizing cannabis is nothing like reducing risk and harm amongst intravenous drug users, it could help potential opiate addicts find a safer, non-addictive substance to manage pain.

Most importantly, the legalization of cannabis in Canada will help the country’s economy. By legalizing recreational weed, Canada is poised to create jobs, bolster existing companies in the space, and potentially rake in billions in previously unrealized tax revenue. But how will the legalization of a DEA Schedule I substance help Canadians? Let’s take a look.

Canada will see increased tax revenue from legal weed.

Medical cannabis is currently legal in Canada, but recreational use is not. This means that there is still an illicit market for the substance, one that the government is not getting a dime of tax money on. Once cannabis becomes legal in Canada, the government will see new tax revenue that didn’t exist before. Analysts predict that this could be anywhere between hundreds of millions and billions of dollars a year.

More cannabis-based businesses will open.

A newly legalized product means more businesses will sell cannabis. This will allow enterprising individuals to open shops, growing operations, and other cannabis-related companies. This will also add jobs to the Canadian economy and, again, increase tax revenues for the country.

Existing publicly traded cannabis businesses will soar in popularity.

Canopy Growth ($WEED.CA, or $WEED on the Toronto Stock Exchange) is already a publicly traded company with a market cap of over $1.7 billion. When cannabis becomes legal nationwide next year, the company will make even more money from their existing products. As long as Canopy can keep up with demand, they and other major Canadian companies like them are poised to become market leaders fairly quickly.

Cannabis’ legal status could pave the way for more scientific studies on the substance.

American researchers that are legally permitted to study cannabis in the states have a hard time doing so. They only get their “research material” from one source, which usually arrives covered in mold and unable to yield any decent results. When Canada becomes legal nationwide, however, Canadian researchers and scientists can pick up the slack for their American counterparts. This would mean conducting further studies on the plant’s benefits (or lack thereof), which could be used in case studies for future legalization efforts elsewhere.

Should you invest in Canadian weed companies? While these companies won’t see a major benefit until 2018, existing weed businesses like Canopy Growth are poised to grow from a billion-dollar operation to a multi-billion-dollar leader in a short amount of time. These companies already laid the foundation for