Unlocking a Green Economy: Cannabis Legalisation Worldwide

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of the Chemical Collective or any associated parties.

Introduction

A dramatic shift in attitudes toward cannabis is well underway worldwide. The long-vilified substance is rapidly becoming a cornerstone of the brand new, emerging legal economies. Governments across the globe are beginning to recognise not only its economic promise, but its potential applications in medicine and therapy. As more nations move to legalise or decriminalise cannabis public perception is altering. A fast-growing legal market is rapidly creating jobs, generating tax revenue, even beginning to reshape entire industries. This is of course also generating myriad new opportunities for international trade and cooperation. In this piece, we will explore the economic benefits that cannabis legalisation can bring, examining how this previously illicit part of the global economy is becoming a driver of prosperity and innovation.

The Emergence of a Global Cannabis Marketplace

After decades operating in the black market, the cannabis industry has stepped confidently into the spotlight. Likely due to the perceived potential profits available, the pace of legalisation has sped up significantly. This is allowing what was once an illicit trade to emerge into a properly regulated, thriving global market. As of the late 2010s, a handful of pioneering regions had already legalised cannabis, for medical or recreational use. Today, many more countries are following suit, encouraged by success stories that highlight both the plant’s economic and societal advantages, alongside its extremely low risk potential.

By 2019, the legal cannabis market worldwide had reached a valuation of around 17.5 billion USD. Projections anticipate an explosive growth rate of over 18% just through the late 2020s! Forecasts suggest that by the middle of this decade, the global market could surpass 70 billion USD. Several factors contribute to these numbers:

• Rising consumer awareness about cannabis products.
• Advancements in cultivation and processing technologies.
• Progressive policy changes to bring the industry into the mainstream.

Leading Cannabis Markets

A handful of prominent players have led the charge in this new era of legalisation. Their experiences highlight just how far-reaching the economic impact of cannabis can be when governments choose to regulate rather than prohibit.

The Americas

United States

The economic transformation, as a result of cannabis legalisation, has never been more visible than it is in the United States. When Colorado and Washington first approved recreational cannabis in 2012, many were skeptical. A decade later and the results speak for themselves. As of 2024, nearly half of the U.S. states have legalised cannabis for adults. An even greater number now permit medical use, if not full, recreational legalisation. This broad policy shift has given rise to a flourishing domestic industry that topped 40 billion USD in 2024, up dramatically from USD 7.6 billion just eight years prior. Some experts project that U.S. sales could approach USD 67 billion by 2028.

Compare this to the worldwide total in 2019 of 17.5 billion USD, and you can see the truly dramatic rise and rise of this industry.

These numbers translate into substantial tax revenues and public-sector gains.

In 2023 alone, American states collectively reported around USD 4 billion in tax collections from cannabis.

This money often helps fund public education, healthcare initiatives, infrastructure projects, and substance abuse treatment programs. These are the kind of investments that will support and aid the progress of communities for years to come.

Beyond the tax benefits, the U.S. cannabis industry has emerged as a significant job creator. From growers and extraction technicians to marketing teams, security contractors, and software developers. Cannabis industry supports an increasingly wide range of roles. By some estimates, the sector now employs over 300,000 full-time workers. This is rapidly eclipsing established industries like coal mining and textiles. Put simply, legal cannabis has become a large, rapidly growing sector of the U.S. economy.

Canada

In 2018 Canada made history. It became the first G7 country to legalise recreational cannabis. This policy wasn’t just a social experiment, it was economically motivated. Within several years, Canada’s regulated cannabis market exploded. By the early 2020s, sales were on track to exceed 4 billion CAD. This is expected to more than double by the latter half of the decade.

The numbers only tell part of the story, though. Legalisation has bolstered Canada’s GDP, adding tens of billions of dollars since the market came online. Tax revenue is now flowing into public services and research initiatives. It has helped fund projects aimed at making the industry safer, more efficient, and more sustainable.

Global cannabis brands have sprung up within Canada’s borders. Companies like Canopy Growth and Aurora Cannabis have built operations far beyond North America, exporting their products and know-how to Europe, Latin America, and Australia. By leveraging its early legal framework, Canada has carved out a reputation as a global cannabis leader, turning policy progress into economic opportunity.

Latin America

With fertile climates and low production costs, Latin America stands poised to become a powerhouse in the global cannabis supply chain.

Uruguay

Uruguay broke ground as the first country to fully legalise cannabis in 2013. Although its initial economic gains were moderate, it established a blueprint for regulated production and sales. Meanwhile, Colombia is leaning into medical cannabis and exports, hoping to generate billions of dollars and create a thriving job market. The country’s ideal growing conditions allow it to produce cannabis more cheaply, giving it a competitive edge internationally.

Mexico

Mexico is on the verge of launching one of the world’s largest legal cannabis markets after its Supreme Court decriminalised recreational use in 2021. With proper regulations, Mexico could channel its cannabis industry into substantial tax revenues, job creation, and the weakening of criminal cartels’ influence.

Argentina

Argentina is also embracing medical cannabis, recently expanding home cultivation and legal sales of cannabis-based products. The government supports local industry growth, research, and development, aiming to spur employment and create a competitive export sector.

Europe

In Europe, the conversation around cannabis has historically been more cautious. This is now beginning to change. Economic considerations and softening social attitudes are prompting many countries to consider legalisation.

Germany

Germany’s decision to move toward full cannabis legalisation could be a defining moment for the European market. Medical cannabis has been legal since 2017, and plans to legalise adult-use cannabis have gained serious traction. Early estimates suggest that legalising the recreational market could generate billions in annual tax revenue and create tens of thousands of new jobs across farming, distribution, research, and retail.

With its strong pharmaceutical sector and robust agricultural backbone, Germany is uniquely poised to become a major player in the European market. As regulations take shape, a well-managed market could drive investment, lower enforcement costs, and encourage innovation in cultivation and product formulation. If Germany commits to full legalisation this will likely influence other European nations to follow suit, potentially beginning a domino effect.

United Kingdom

The UK’s approach has so far been measured. Certain medical cannabis products have been available since 2018. Regulatory hurdles and cautious prescribing have limited economic growth thus far, but the door is now open. With projections suggesting the medical cannabis sector could be worth over £1 billion within a few years. This illustrates the potential for significant gains if a fully legal market is permitted to grow.

The UK’s existing research institutions and pharmaceutical companies are well-positioned to drive product development and clinical studies. A booming CBD market has shown that there is consumer appetite for cannabinoid-based health and wellness products. If regulations continue to ease, the UK could join Germany as a key player in Europe’s medical cannabis ecosystem. 

Netherlands

Long famous for its cannabis “coffee shops,” the Netherlands is moving toward a more formally regulated cannabis industry. The Dutch approach has traditionally been based on tolerance rather than outright legalisation and has attracted tourists for decades. Modern efforts at more organised legalisation/regulation focus on ensuring product safety and supply chain transparency. These changes could increase tax revenues and position the Netherlands for sustainable growth in a fully legalised market.

Spain and Portugal

Spain’s Cannabis Social Clubs operate in a gray area, allowing members to cultivate and share cannabis. This model has contributed to local economies, and analysts suggest that a fully regulated market could generate billions in revenue and create thousands of new jobs. Meanwhile, Portugal’s momentous decision to decriminalise all drugs in 2001 shifted resources usually focused on enforcement to healthcare and education. While cannabis has not been outright legalised, Portugal’s approach shows that easing criminal penalties can free up funding for more constructive societal investments. Should Portugal choose to regulate cannabis in the future, it might capitalise on this solid foundation to achieve substantial economic gains.

Asia

Asia, long considered strict on drug enforcement, has recently shown surprising signs of change, driven by both economic ambitions and shifting social attitudes.

Thailand

Thailand made waves by legalising medical cannabis in 2018 and then effectively decriminalising it in 2022. The government encouraged households to cultivate hemp and other cannabis varieties to support local economies. Today, Thailand’s cannabis market is expected to grow rapidly. Government support will likely allow the market to exceed hundreds of millions of dollars in value within the next few years.

This shift has boosted tourism dramatically, with visitors intrigued by the chance to sample high quality products or explore cannabis-themed wellness retreats. Meanwhile, foreign investors have taken note, seeing Thailand as a potential export hub for medical-grade cannabis and a springboard into other Asian markets.

Pakistan

Facing economic difficulties, Pakistan’s recent decision to regulate cannabis cultivation for medical and industrial purposes is a strategic attempt to tap into a new revenue stream. By establishing a national regulatory authority, the government aims to attract foreign investment and develop an export-oriented cannabis sector. With vast agricultural regions ready for cultivation, Pakistan hopes to generate substantial income and reduce reliance on traditional exports, thereby bolstering its foreign reserves.

Africa

Africa’s favorable climates and agricultural expertise have caught the attention of cannabis investors. As several nations ease restrictions, they are discovering a chance to diversify economies historically reliant on commodities like tobacco.

Lesotho, South Africa, Zimbabwe, and Malawi have either legalised or are moving toward legalising medical and industrial cannabis.

These nations aim to create new farming jobs and draw in foreign capital. This will foster industry ecosystems that can export cannabis derivatives to global markets. South Africa, for example, is crafting regulations to encourage a legal cannabis sector, while Zimbabwe and Malawi have begun handing out licenses for medical cultivation. These steps could lead to significant economic payoffs, advancing African agriculture into a more lucrative era.

Key Economic Benefits of Cannabis Legalisation

Why are so many countries easing their cannabis laws? While motivations vary, the economic advantages are often front and center.

1. Tax Revenues
   Legal sales of cannabis products create substantial new tax streams. These funds can be funneled into education, healthcare, infrastructure, public safety, and more. For example, California collected over a billion dollars in cannabis taxes in a single year, showcasing the fiscal potential when markets mature.
2. Job Creation
   The cannabis supply chain—spanning cultivation, processing, distribution, retail, and services—can employ tens or even hundreds of thousands of workers. This ripple effect extends to other sectors: security firms, marketing agencies, packaging companies, and legal consultancies all benefit when a cannabis market emerges.
3. Reduced Law Enforcement Costs
   Shifting cannabis from the criminal sphere to the regulated marketplace reduces enforcement expenses. Governments save on arrests, prosecutions, and incarcerations for minor cannabis-related offences. These savings can then be reallocated to pressing community needs, such as combating violent crime or improving treatment programs.
4. Public Health Improvements
   Legalisation doesn’t just deliver economic growth—it also allows authorities to regulate product quality and potency. This ensures safer products and can support educational campaigns about responsible use. Patients gain improved access to medical cannabis treatments for conditions like chronic pain or epilepsy, fostering innovation in healthcare.
5. Tourism Opportunities
   Cannabis-friendly destinations attract visitors curious about the legal market. This “cannabis tourism” can boost local economies through dispensary visits, tours, festivals, and hospitality services. Colorado’s experience shows how welcoming cannabis can infuse fresh energy into tourism sectors.
6. Agricultural and Industrial Expansion
   Beyond recreational products, the industrial applications of hemp—a variety of cannabis—are wide-ranging. Hemp can be used in textiles, paper, biofuels, construction materials, and even bioplastics. By embracing hemp, countries can spark sustainable industrial growth, reduce dependence on imports, and support rural development.
7. Medicine and Pharmaceuticals
   Legal frameworks around cannabis encourage research and development. Scientists can study cannabinoids more freely, leading to new pharmaceuticals, wellness products, and therapies. Countries that invest in research may become leaders in this cutting-edge field, tapping global demand for medical breakthroughs.
8. International Trade and Exchange
   As legalisation spreads, opportunities arise for global trade in cannabis and hemp products. Climate advantages and agricultural expertise can position certain countries as key exporters. Harmonising standards, ensuring quality control, and forging international trade agreements can help this market flourish.

Challenges and Sustainability

Of course, legalisation is not without hurdles. Governments must implement sound regulations to ensure fairness, prevent underage consumption, and maintain product safety. They must also consider social equity measures. Pardons for previous minor cannabis offences and opportunities to communities historically harmed by prohibition of the substance.

Crafting effective policies involves balancing international treaties, domestic politics, and public health needs. In some regions, oversupply has led to price drops and industry consolidation.

It cannot be understated that continuous research into long-term health effects is necessary to guide future regulation.

The lessons learned by early adopters can help newer markets avoid pitfalls and strive for sustainable, responsible growth.

A Global Green Economy

Cannabis legalisation marks the start of a new economic era. By moving beyond prohibition, countries open the door to innovation, job creation, and more efficient use of public funds. As markets mature, we may see an increasingly interconnected global trade network, with high-quality cannabis and cannabis-derived products circulating freely worldwide. Technological improvements, such as automated cultivation and biotechnology-based breeding, can further enhance productivity and product diversity.

The integration of cannabis into mainstream industries offers vast potential with areas as diverse as:

• Pharmaceuticals
• Textiles
• Cosmetics
• Wellness
• Construction materials

Those nations that invest today in education, research, and skill development will be best placed to shape the future of this green economy. By learning from successes and setbacks in countries that have gone before them, policymakers can find the right balance between fostering growth, protecting public health, and ensuring fairness.

Conclusion

The worldwide cannabis industry is at a transformative moment. The transition from underground, black market trade to a respected contributor to national economies is not without its challenges. However, the case for economic benefits is increasingly hard to ignore. Tax revenue, job creation, agricultural development, medical innovation, and international commerce all benefit hugely from legal cannabis.

By observing how pioneering markets have harnessed cannabis for the greater good, newer adopters can chart a smarter path, guided by thoughtful regulation and robust research. Community engagement, and a commitment to social justice are also paramount for sustainable success. the legalisation of cannabis can serve as a blueprint for constructive policy change—one that delivers tangible, lasting prosperity. In this sense, the green economy unfolding around cannabis is more than just a trend; it’s an enduring economic force that has the potential to reshape our global landscape for decades to come.

David Blackbourn | Community Blogger at Chemical Collective

David is one of our community bloggers here at Chemical Collective. If you’re interested in joining our blogging team and getting paid to write about subjects you’re passionate about, please reach out to David via email at blog@chemical-collective.com