Foreign investment in emerging legal medicinal cannabis markets: the Jamaica case study

INTRODUCTION: The establishment of a legal market for medicinal cannabis under the Dangerous Drugs Amendment Act 2015 has positioned Jamaica at the forefront of cannabis law reform in the developing world. Many local cannabis businesses have attracted investment from overseas, including from Canada, US and Europe. AIM: To explore the opportunities and risks of foreign investment in an emerging domestic legal cannabis market in a developing country. METHODS: Thematic analysis of semi-structured face-to-face interviews with 22 key informants (KIs) from the Jamaican government, local cannabis industry, academia and civil society, and field observations of legal and illegal cannabis cultivators. RESULTS: KIs from the Jamaican public agencies and domestic cannabis entrepreneurs saw foreign investment as an essential source of capital to finance the start-up costs of legal cannabis businesses. Local cannabis entrepreneurs prioritised investors with the greatest financial resources, brand reputation and export networks. They also considered how allied an investor was with their business vision (e.g., organic cultivation, medical vs. recreational). The key benefits of partnering with a foreign investor included transfer of technical knowledge and financial capital, which enhanced production, quality assurance and seed-to-sale tracking. Some KIs expressed concern over investors’ focus on increasing production efficiency and scale at the expense of funding research and development (R&D) and clinical trials. KIs from the local industry, government agencies and civil society highlighted the risks of ‘predatory’ shareholder agreements and domestic political interference. Concerns were raised about the impact of foreign investment on the diversity of the domestic cannabis sector in Jamaica, including the commitment to transition traditional illegal small-scale cannabis cultivators to the legal sector. CONCLUSION: While foreign investment has facilitated the commercialisation of the cannabis sector in Jamaica, regulatory measures are also needed to protect the domestic industry and support the transition of small-scale illegal cultivators to the legal regime. Foreign investments may alter the economic, social and political determinants of health in transitioning from illegal to legal cannabis market economy.