In terms of legalisation and technical innovation, the US, Canada and Israel have been at the forefront of the global stage, but hot on their heels to capitalise on this opportunity are countries in Europe, Asia and Africa – and the trend shows no signs of slowing down.
Europe’s medical cannabis market is set to become the world’s largest legal cannabis market over the next five years. Eager to enter this market, Cyprus legalised the medical use of cannabis oil in January 2017 for use by advanced-state cancer patients only, and in February 2019 a more expansive law was passed which increased the number of qualifying medical conditions – and permits under certain strict prerequisites and conditions the import of cannabis seeds and plants for cultivation, production, processing and export of medical cannabis.
The 2019 law also launched the possibility of an international bidding process for an initial roll-out of three licenses to cultivate medical cannabis in Cyprus, with the aim to attract companies with solid experience in the field of cultivation and production to enter the Cypriot market.
This presents a unique opportunity for Cyprus to step into this growing global sector as a new entrant. The local economy could benefit significantly from education, research and development, increased employment opportunities as well as production, distribution, processing and export of Cyprus-grown cannabis.
In the wake of these developments, the Cyprus Cannabis Association was formed in October 2019 under the auspices of the Cyprus Chamber of Commerce and Industry to help build up this new industry. At the helm of the Association is its President Andria Andreou, a dynamic lawyer with years of experience gained both in London and Cyprus law firms. The managing partner of Athos Group Cyprus, a highly regarded provider of trust, corporate, legal and consultancy services worldwide, Andria also sits on the board of several prominent structures that are involved in a range of sectors such as medical cannabis, information technology, commercial real estate and financial services.
Ambitious and energetic, Andreou has taken the same hands-on and focused approach she has in business to running the new Association, and is convinced that developing a compliant, transparent and high-quality cannabis industry would bring significant benefits for multiple economic sectors in Cyprus.
Cyprus is in the process of amending legislation to allow for the launch of an international tender process to attract bids to cultivate medical cannabis on the island. What potential economic benefits do you see for Cyprus in fostering this industry?
Europe’s medical cannabis market is estimated to be worth up to €123 billion by 2028 and is set to become the world’s largest legal cannabis market over the next five years, according to the 4th edition of the European Cannabis Report produced by London-based advisory group Prohibition Partners. Cyprus is perfectly positioned to capitalise on this opportunity for numerous reasons. As an EU member with a favourable tax regime and wide network of double tax treaties, as well as excellent infrastructure, geographical location and superb weather conditions, Cyprus would enjoy a significant economic boost from the production, distribution and exportation of hemp and medicinal cannabis when it is eventually grown here.
This is a truly unique opportunity to develop Cyprus into a contender within the international cannabis industry, which is currently one of the most intriguing and rapidly growing agricultural, medicinal and industrial markets that has emerged in decades.
We could play a leading role in the development and expansion of this emerging industry and reap numerous benefits. Bringing a new ‘cash-crop’ to Cyprus’ agriculture sector would create jobs across the entire supply chain and provide important engineering and manufacturing facilities. This activity would derive additional tax income for the economy, new expertise and research, and we could look at establishing a ‘cannabis innovation’ hub for Europe right here in Cyprus.
There has been some delays in opening the tender process for the coveted initial three licences. Is this process on track and what is the current position of prospective investors?
Despite the delays, which is usual in this ‘global start-up’ phase of cannabis developments, the process is still on track pending some legislative amendments and we are all excited about the initial bidding round for the three medical cannabis licences, each one of which will be valid for a 15-year term.
We have seen remarkable interest expressed from prospective investors primarily from the US, Canada and Israel who are seriously looking at Cyprus to establish their headquarters for cultivation of hemp and cannabis, and to also create an export base for both Europe and the world. Part of our role as the Cyprus Cannabis Association is to assist in any way possible to speed up this process, and to support and advise our members and prospective investors in their efforts to enter the Cypriot market.
Speaking of your role, could you expand a bit further on the objectives of the Cyprus Cannabis Association (CYCA)?
In a nutshell our three key objectives are to educate, connect, and lobby. The CYCA works closely with both the Cyprus Chamber of Commerce and Industry (CCCI) as well as other relevant government departments to promote the creation, growth and further development of the industry. In due course, growers and processors will need to be empowered to ensure the entire cannabis plant is fully utilised to enable access to all its potential uses. This means that we will support and promote the cultivation, processing, distribution, manufacturing, import and export and use of cannabis and its products.
The CYCA represents all stakeholders and communities that can benefit from a sustainable and flourishing cannabis industry. Our role is to be the resident voice and industry representative to the Cyprus government and other institutions in order to promote a financially viable cannabis industry within Cyprus. Part of this is to submit recommendations for any legislative or other changes, participate in the required process, and to establish a regular exchange of information between all participants – including on an EU and international level to further the commercial and agricultural use of industrial and medical cannabis in all its forms.
However, the educational aspect is absolutely crucial and our responsibility is to provide current and reliable information on cannabis both to the government and the public. In Cyprus and many other countries cannabis continues to have a bad reputation and is surrounded by controversy. These attitudes are changing rapidly, although more work needs to be done to get rid of these negative associations that sometimes hinder progress. Cannabis has the potential to transform lives and not only considerably improve healthcare services in Cyprus, but also create new jobs and inject a significant boost to the economy. With effective communication and reliable data, we aim to change minds about cannabis and trigger further reforms so that patients can improve their quality of life as a matter of basic human right.
Reliable information and education are key to eradicating misconceptions about cannabis. Could you give us a recap on the benefits and potential uses?
The beauty of cannabis is that all it is doing is supplementing the body’s natural cannabis system called the endocannabinoid system. Humans have this natural system throughout the body, so it is not surprising that the plant has many medical benefits.
Cannabis is a plant that contains biologically active compounds in its stems, leaves and flowers. There are many types of strains of the three cannabis subspecies (Cannabis Sativa L, Cannabis Ruderalis, Cannabis Indica). The two most biologically active compounds in cannabis are tetrahydrocannabinol (THC) and cannabidiol (CBD). Each plant has specific THC-to-CBD ratios and because of this some strains have different kinds of effects than others.
THC affects how you think, act and feel. It can make you feel intoxicated or ‘high’ and of course we do not advocate the use of cannabis for this purpose. However, THC in the correct composition has great medicinal value. CBD on the contrary has a more relaxing effect with no side effects. Both compounds have proven to be useful for medicinal purposes to help treat symptoms like pain, inflammation, bowel disease, seizures, nausea, and patients who suffer from conditions like cancer, HIV/AIDS or multiple sclerosis.
In Cyprus the expanded law in February 2019, called The Drugs and Psychotropic Substances Laws of 1977 to 2019, increased the number of qualifying medical conditions to include chronic painful conditions associated with, among others, HIV, degenerative diseases of the motor system, rheumatism, neuropathy and glaucoma, Tourette's syndrome and Crohn's disease.
And as for the industrial use of cannabis – hemp?
Cannabis used for industrial purposes is called hemp, and the cultivation and export of hemp in Cyprus has been legally permitted since 2016. For hundreds of years hemp has been used in paper, textiles and clothing, and more recently in biodegradable plastics, paint, insulation and even pet food, wellness and beauty products. It is one of the fastest growing agricultural crops in the world with enormous industrial processing post-harvest use and low overall environmental impact – a factor that is increasingly important in fighting climate change.
What are the current cannabis industry trends globally and what is the vision for Cyprus in developing this industry?
In 2019, the pace of legalisation and technical innovation picked up speed exponentially. The three major trends that stand out for the rapidly growing cannabis industry in 2020 and beyond are legalisation in more countries around the world, innovation and better industry oversight.
Agricultural research and development mean the strength and effect of a cannabis strand are virtually customisable to the person. Industry improvements allow for the manipulation of THC and CBD levels in ways that could not possibly have been imagined only a decade ago. Each technological stride opens a new potential market to the cannabis industry and consumption methods include edible products, drinks, oils and creams and vaporiser juice.
For example, our neighbour Israel is a world-renowned science and technology hub and has also become the leader within the cannabis industry injecting $2.13 million into 13 cannabis research projects – making it one of just three countries with government funding for research. This is something that Cyprus could replicate in building its industry thanks to its growing reputation as an education and knowledge hub with its numerous universities and research institutes.
Medical benefits of cannabis are well known, but scientists and engineers now have access to resources that will revolutionise our understanding of cannabis properties. It will be crucial for the industry to continue staunch support of well-substantiated research to drive continuous improvement in both agricultural and retail safety and to nurture professional business practices at all levels.
A record level of investment in research and development has seen new facilities opening across Europe – from Ireland and the UK to Portugal, Malta, Greece and Czech Republic. Careful assessment and monitoring of progress in these countries will prove to be useful for Cyprus in creating its own development strategy and vision. However, what is crystal clear to our Association is that the three main components that need to be at the very centre of these efforts are compliance, transparency and quality to ensure the industry is sustainable and financially viable in the future.