Asia CBD news
Anticipated China Legislation, to Boost and Expand Business Model
In Asia, and specifically China, adherence to principles of the 1961 United Nations Single Convention on Narcotic Drugs, prevents the distribution of consumable products derived from hemp of low THC content (hemp 0.3% and below). Although a date has not been published, speculation is that a repeal of this law is anticipated as early as June 2020. The recommendation for the repeal came from an open letter from the Director-General of the United Nations' World Health Organization to the United Nations, dated January 24, 2020.
If implemented, the repeal would remove restrictions and usher in the ability for all CBD industries to be fully commercialised across this vastly populous region. This will include pharmaceuticals, nutraceuticals, edibles and every other hemp CBD related product. Currently, consumable CBD products are restricted for sale in China to those with licenses, other than with respect to CBD infused skincare, cosmetic and other non-ingestible goods.
James Foster, CEO of CGA noted: "The proposed repeal represents a very unique opportunity to monetise and create new market opportunity of such a large scale in Asia. Canrim is positioned strategically to take advantage of this through our development work over the past few years, and my Asia team assembled over past 10 years."
The repeal would represent significant growth opportunities in China and elsewhere in Asia, with some estimating the global industry to be as large as US$26 billion, led largely by Asia and specifically China, with pharmaceutical products expected to represent the largest market segment.
The relaxation of regulations in China represent remarkable opportunities for CGA's investment and distribution businesses, as CGA will be able to seamlessly onboard new products through the iBloom platform and CGA's network and distribution channels, which currently have been designed to act as a conduit and first mover for the significant CBD cosmetic product market. Should current regulations respecting CBD pharmaceutical, nutraceuticals and edibles be relaxed in China, as is currently expected, it would create significant new market opportunities for CGA and by extension, Canrim, beyond its current ambitions of being a first mover in the Chinese CBD cosmetic products industry.