Is China on its way to becoming a global superpower for cannabis sales? Recent developments in the country’s business market demonstrate a new interest in the cannabis industry, but not for any recreational reasons. It may seem a little strange that China has begun to express an interest in this industry, especially considering the fact that it has some of the most restrictive drug laws in the world. With that being said, China’s interest in the cannabis industry is exclusively for the plant’s non-intoxicating compounds – meaning that we won’t see anyone getting high in China for the time being.
In China’s Heilongjiang and Yunnan provinces, the cannabis industry is steadily growing. The National Bureau of Statistics indicates that in 2017, 13.7 tons of cannabis were produced in these two regions alone. Despite the societal stigma in China relating to anything drug-related, it is believed that the plant can contain may healing properties, and can be used to create a variety of different items including rope, paper, and fabrics.
It is to be noted that the many benefits of cannabis are still relatively unknown. As such, the countries in which cannabis-related regulations have been put in place still operate within a grey area, including the United States and Canada. If and when China’s business market adapts to the cannabis industry, the domestic and international sale of cannabis products will surely be complicated.
Do You Know Your Cannabis?
China is specifically interested in cannabis’ cannabidiol component, often referred to as CBD. CBD is not an intoxicating substance, and should not be confused with cannabis’ most beloved component, tetrahydrocannabinol, also known as THC, which produces the intoxication many in the West have come to enjoy. Of the two main categories of cannabis, CBD is found mostly in hemp, which is a type of cannabis containing less than 0.3% levels of THC, whereas marijuana’s main component is THC.
In many Western countries around the world, marijuana production has typically been under heavier federal regulations due to its toxicity levels. In the United States, for example, marijuana regulations fall under federal jurisdiction, in contrast to hemp, which was just recently legalized for commercial purposes in 2018. In China, farmers must apply for permits if they are interested in cultivating hemp, while most types of activity related to marijuna cultivation or consumption is still highly illegal.
It is estimated that with China’s newly found interest in the cannabis industry, the global CBD market will achieve a record number of sales in the years to come. Current projections indicate that CBD-related products could make up over $22 billion of the international consumers market by 2022, and will therefore only increase with China’s involvement in the industry. With this in consideration, China’s interest in the cannabis industry would introduce the market to new levels of competition, where they would come up against leading countries in the hemp industry – Canada and the United States.
Currently, several drugstores in the United States, including CVS and Walgreens, sell a variety of hemp-based products including patches, creams, and salves. With high consumer demand for such products, the current international context’s lack of clear regulations around the hemp-industry could mean that if a rising economic power like China wants to further implicate itself in the hemp industry, we might just be able to transform the way we use cannabis in the future.
It certainly appears that China’s interest in CBD products is global, but the legality of importing such products to China is still unclear. Currently, China’s CBD market makes its profit from exports to Canada and the United States. Domestically, however, home-produced products are regulated due to the country’s restrictive drug policies, explaining the industry’s reliance on exports. While China makes very little profit in the domestic and importation sectors of the CBD industry, it is still bound to be a serious contender on the international scale.
Currently, China is attempting to diversify its CBD products to clothing and home goods, not necessarily complying with current global CBD demands and trends. This attempt to diversify China’s CBD products is meant to minimize the country’s risk of implicating itself with a new and fluctuating industry.
There still lies several questions of legality regarding the consumption and sale of CBD within China’s borders, and this can perhaps change if Chinese hemp-based industries and farmers can prove to the government that CBD is a promising industry. If this occurs, China can surely become a budding player on all fronts of the CBD economy – both domestic and international.
Edited by Sophia Kamps
The opinions expressed in this article are solely those of the author and they do not reflect the position of the McGill Journal of Political Studies or the Political Science Students’ Association.
Image by Roberto Valdivia via Unsplash