Report: Netanyahu nixes medical marijuana export because of Trump

The prime minister said US President had called him and expressed his objection to pot exports. The industry was expected to earn Israel $1-4 billion a year.

February 7, 2018 22:52
2 minute read.
A worker touches a cannabis plant at a growing facility for the Tikun Olam company near the northern

A worker touches a cannabis plant at a growing facility for the Tikun Olam company near the northern city of Safed. (photo credit: REUTERS/NIR ELIAS)


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Prime Minister Benjamin Netanyahu said US President Donald Trump called and expressed his objection to Israeli exports of marijuana, an industry expected to earn the country between $1b. and $4b. a year.

Channel 2 News reported on Wednesday evening that Israel will forgo its plans to become a pioneer medical marijuana exporter for fear of upsetting Trump.

According to the report, Netanyahu announced putting the ambitious export project on hold in a meeting on Sunday with the ministers of agriculture, health and finance.

Before the ministry representatives could present their arguments, Netanyahu said Trump had called him and made clear his general attitude against marijuana exports, the report said.

Netanyahu told the ministers that it would not be wise to be the vanguard in this field, noting that Canada is the only country that has authorized the export of cannabis.

The report noted that when a Finance Ministry representative suggested that the problem could be skirted by avoiding export to the US, Netanyahu said it might not serve Israeli interests to go against the administration’s policy.

Last month the US Justice Department reversed its policy on the marijuana business, withdrawing legal guidelines widely seen as giving safe harbor against prosecution to cannabis businesses in states in which pot is legal.

An interministerial committee of the Israeli Finance and Health Ministries approved the export of medical cannabis in August 2017.

“The export of medical cannabis is an industry with significant economic potential for the State of Israel and will strengthen Israeli agriculture in general and agriculture in the Arava region in particular,” Finance Minister Moshe Kahlon said at the time. “It will serve as an opportunity for the country to exploit its relative advantage in developing medical products from medical cannabis.”

The committee found that Israel has many advantages in the budding market in terms of research and development, advanced regulation, clinical experience and climate.

It recommended that exports be approved only to countries which permit the use of medical cannabis and explicitly allow import from Israel, and that such exports be approved only for farmers who receive a Health Ministry license to grow it and export the cannabis.

Netanyahu’s decision will surely anger growers and investors who have poured millions into the industry. The government’s decision last month not to include the licensing of cannabis exporters in the 2018 budget, left some of them threatening to sell their wares on the black market. If, as reported, fear of upsetting Trump is behind the plan’s nixing, the entrepreneurs may have a long time to wait.

An estimated 50 Israeli medical marijuana companies work in cultivating plants or producing delivery devices such as inhalers, along with exporting cannabis cosmetics and skin-care products. In 2016, international investors poured more than $100 million into Israeli marijuana firms, according to Reuters.

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