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Why Pot Stock Investors Need to Pay Attention to Mexico

Written By Jeff Siegel

Posted July 19, 2018

A couple of weeks ago I told you how the new president of Mexico, Andrés Manuel López Obrador, was bullish on ending the war on drugs.

This is huge news for cannabis investors looking to take advantage of the expansion of legal cannabis markets outside of Canada and the United States.

In that article, I noted that in 2005, Obrador was actually a militant advocate of the war on drugs. But over the years, he transitioned away from that stance and eventually became an opponent of the war on drugs.

In fact, the president-elect has not only declared the war on drugs “unwinnable,” but he said that the state should stop trying to fight the narcos entirely in an effort to ensure peace in Mexico. He’s even looking to provide amnesty for those who have been growing drug crops.

In addition to this, Obrador’s choice for Interior Secretary, Olga Sánchez Cordero, is a huge advocate of legalization. Here’s a snipped of piece she wrote for the Mexican newspaper Melenio …

The world war on drugs has failed. I do not share simplistic or totalitarian solutions, such as “a drug-free world”. We must be willing to discuss – openly – the need to carry out multilateral institutional actions on an international scale

The birth of new Mexican drug cartels and the magnitude of their expansion on a national scale has left a trail of blood and pain in our country; The figures of dead and missing – which are frightening – directly or collaterally, have been (for more than 20 years) the failure of the anti-crime policy. The debate between justice, health and the drug trade has never been led by the Mexican State; it has only been criminalized and fought with the hardening of sanctions, bringing mourning to thousands of families, both of the federal forces, and of those who have mistaken the way to commit a crime.

There’s no vagueness to any of this. And just yesterday we learned that the president-elect is giving Cordero complete freedom to explore legalization as a tool to curb violent crime, with Cordero telling reporters …

On the subject of decriminalizing drugs, Andres Manuel told me, and I quote: ‘Carte blanche. Whatever is necessary to restore peace in this country.”

Although this story hasn’t garnered much attention in the states, the reality is that if Mexico does proceed with legalization, there are a number of cannabis stocks that could get a nice boost. From companies that have already made inroads to the Mexico market, such as Khiron Life Sciences (TSX-V: KHRN) and Medical Marijuana, Inc. (OTCBB: MJNA) to some of the bigger players that have the cash and muscle to swoop right in, such as Canopy Growth Corporation (TSX: WEED), Aphria, (TSX: APH), and The Green Organic Dutchman (TSX: TGOD).

Given that this really could be a very lucrative market, and of course bolster the prospect of what I like to call the Great North American Legal Cannabis Trade, we’ll keep you posted as more develops.