On Sunday, an interministerial committee consisting of Israel’s Health and Finance Ministries announced its approval of exporting medical marijuana. This will generate an estimated NIS 1 billion to NIS 4 billion extra every year for the state. Now, any operation that meets the necessary requirements may get a license to cultivate, produce, distribute, or store medical cannabis.
Globally, the average price for weed is approximately $10 per gram. Medical marijuana prices are steadily growing, however. In 2000, the world was producing roughly 1.3 tons for the cannabis exporting industry, but by 2014, this production grew to a whopping 57.3 tons. The State of Israel sees the opportunities this growth provides, and it is taking decisive steps to get in on the export market.
According to Israel’s Finance Minister, Moshe Kahlon, “The export of medical cannabis is an industry with significant economic potential for the State of Israel. It will strengthen Israeli agriculture, in general, and agriculture in the Arava region, in particular. It will serve as an opportunity for the country to exploit its relative advantage in developing medical products from medical cannabis.”
Ya’acov Litzman, the Health Minister, is opposing of this view. Just last week, he said that he was against the move, but that if passed, he would demand the health system receive some of the profits. He said, “The attitude towards cannabis should be like that of any drug. Remember that the law prohibits the use and trade of cannabis except in special medical cases, and under special restrictions.”
He continued to say, “Due to the international interest in Israeli medical cannabis because of its quality and economic potential, we have agreed with the Finance Ministry to approve the exporting medical cannabis under certain restrictions, and to countries where there is legal approval. We will ensure that our health sector benefits as a result of the increase in state revenues.”
Director-general of the Finance Ministry, Shai Babad, had this to say, “The interministerial committee did a professional job, and after thorough examination of the matter, decided it is feasible to export medical cannabis and bring significant economic benefits to the Israeli economy, according to the standards set forth by the Health Ministry.
He further recommended that the committee allow cannabis export from Israel for medicinal purposes. The Health Ministry’s director-general, Moshe Bar Siman Tov, added to these sentiments by saying, “We are leading experts in a field that is innovative in the world, and therefore, it must be done with caution and great responsibility, while meeting the highest professional and medical standards.”
Litzman and Kahlon received the committee’s recommendations, headed by both director-general’s and representatives from the ministries of internal security, justice, agriculture and rural development, and economics and industry. Before submitting its recommendations, the committee examined the legal, regulatory and economic aspects of exporting medical marijuana.
The team paid particular focus on the Health Ministry’s policy of regulating medical cannabis in Israel. According to the committee, the current international market is in the ideal state for Israel to take advantage of its economic potential. It also has competitive benefits it can opportune on, including advanced technology, development, climate, regulation, and research, all of which entrepreneurs, scientists, and farmers can exploit for the production of high-quality medical weed products.
However, this approval comes with several restrictions. The Health Ministry, or direct parties themselves, must oversee all exports, which the State will monitor very closely. Only countries that explicitly allow Israeli exports, and only those that allow the use of medical marijuana, will be able to receive products from the State. Additionally, only approved farmers with Health Ministry-issued licenses will be able to grow or export their medical cannabis.
Those that comply will be able to export marijuana in all its medicinal forms, including oils, tablets, flowers, and more. Over the last few years, more than 30,000 patients have received permission from the Health Ministry to use medicinal cannabis to relieve pain and treat disease. The State is clearly moving toward full legalization in the near future.
For the Finance Ministry, its position stems from analysis into the economic potential of the export market, and that as a virgin industry, it offers many opportunities for the State to increase its GDP, for which it already has the competitive advantage. Currently, eight licensed growers are cultivating about 10 tons of medical marijuana a year in Israel and more than 500 are applying for exporting licenses.
Big business in Israel
Opportunities for them to increase its GDP.