“Colombia has a very troubled history with foreign investment,” says Boris Navarro of Eightfold, a Colombian/US partnership involved in legal cannabis production. “I used to work in petro. I saw first hand the damage and exploitation that irresponsible capitalism has caused in my country. North American companies came here for decades, took what they wanted and left behind only devastation.”
Navarro and a group of other cannabis entrepreneurs are hoping a booming cannabis industry can be a solution to deeply-rooted societal problems in this South American nation still struggling with the aftermath of a 50 year civil-war.
As Colombia considered legislation to legalize cannabis in 2016, small illicit and traditional indigenous farmers had hopes they could come out of the shadows and join what promised to be a booming industry. After the country legalized cannabis cultivation and exportation with corresponding permits, the industry has exploded. It is the fastest growing recipient of foreign direct investment (FDI) in the Colombian economy. As of the end of 2019, 168 licenses had been granted, and 450 were being processed, according to the Ministry of Health, one of two Colombian agencies tasked with enforcing strict state regulation.
But local co-ops and impoverished communities have been largely left out of a process that is becoming increasingly dominated by international partnerships and conglomerates.
If growth continues at its current rate, greenfield investments in legal marijuana will become the third largest FDI sector of the Colombian economy, lagging behind only mineral extraction and petroleum, according to the Colombian National Administrative Department of Statistics (DANE by its Spanish acronym).
World demand is growing as well. Nineteen countries have legalized the import of cannabis products, with Brazil becoming the most recent in a December 3 decision to supply its medicinal markets completely through importation. Some entrepreneurs believe Colombia is positioned to be the largest global exporter of legal marijuana by 2030.
But can this cannabis gold rush be handled in a more sustainable manner than the resource grabs conducted by North American companies in the past? And can a nation still struggling with the aftermath of half a century of war transform the stigma of illicit crop production into a positive?
No one can farm in a war zone
Impoverished agricultural communities in rural areas of Colombia have long been ignored by the national government, particularly in formerly rebel-controlled areas. Extreme poverty is three times as widespread in the countryside as in the cities, and large areas of the country lack potable water, reliable roads or even an electrical grid.
“For an independent farmer in Choco or Putamayo, it costs more to bring goods to market than a harvest is worth,” said Gimena Sanchez-Garzoli, Andes director for human rights group WOLA. “Roads are often little more than rutted dirt paths, making transportation of crops difficult and expensive. If you grow oranges, they rot in the field. If you grow coca, the narcos come to you.”
And with the drug trade, comes rising violence, corruption in local government and cycle of dependency and exploitation at the hands of armed groups that has proved to be a barrier against responsible development for decades.
Primavera Trujillo, a cannabis entrepreneur and business owner in the state of Magdalena, hopes the new industry can break a cycle of poverty and exploitation in which investment historically hasn’t benefited Colombian poor, but rather exploited them. “What these communities lack is an economically sustainable alternative,” she said.
She believes government crop substitution programs, which pay farmers in coca regions to grow other goods are ineffective. The United Nations Office on Drugs and crime reports that only three per cent of farmers who have signed up for the Colombian program have received the full promised payment. Fifty-percent have received nothing at all. Vulnerable communities simply go back to growing coca, and more aggressive government anti-drug tactics only serve to worsen their social and economic situations.
“No one can farm in a war zone,” said Trujillo.
“These communities have heard promises to make the future better from foreign companies before,” however, says Sanchez-Garzoli of WOLA, companies that often left little behind other than economic and ecological devastation.
Foreign capital and fast-growing industries have created problems in Colombia in the past; from the “banana massacre” in 1928 by the infamous United Fruit Company, a US corporation with a bloody history across Latin America, to recent violence and displacement of peoples due to a Palm Oil boom that was initially encouraged by a Colombian government looking to grow foreign investment, to “extraction grabs” by North American oil companies from both the United States and Canada throughout the 20th Century.
Mineral and petroleum extraction specifically is a topic of alarm for many Colombians. The industries have a long history of exacerbating instability in remote areas controlled by armed groups as well as exploitative labor practices in the impoverished communities where most oil deposits lie.
Foreign conglomerates such as AngloGold Ashanti and BP Salina, have been implicated in credible complaints of economic devastation, destabilization of Indigenous and Afro-Colombian communities as well as repression and extra-legal prosecution of labor and environmental activists.
Ninety per cent of attacks on social and labor leaders in Colombia were on activists and labor leaders opposing the interests of corporations operating in rural areas, according to a 2019 report from Business and Human Rights Defenders, an organization that tracks corporate responsibility in Colombia.
“Foreign capital in the past has had a devastating impact on my country,” said Eightfold’s Navarro. “We have to learn from these mistakes and avoid them as the cannabis industry takes off.”
Complex legislation, farmers left out
The Colombian government has created a strict regulation process as part of an effort to avoid the mistakes of past decades. The bureaucratic hurdles have led to complaints from some multi-nationals trying to break into the promising sector, but perhaps more problematic are the small farmers who find themselves holding licenses and yet locked out of the process.
“The process [of certification] is incredibly complex,” said Carlos Rodriguez Vives, a grower and local partner with Canadian company Avicanna. “And even once we had our licenses, we had to negotiate with the local government to demonstrate we had proper security, a credible source of financing and prove we were employing workers from the region.”
There have also been accusations that Canadian conglomerates bought their way into the process before the oversight was formalized. Toward Freedom reported in October that Canadian companies PharmaCielo and Cannavida were granted licenses to grow medical marijuana even before regulations connected to legalization were fully approved by Colombia’s congress.
In the 1980’s, 80 per cent of farmers on the Atlantic coast of Colombia were growing small amounts of marijuana alongside food crops according to a 2019 study by the Transnational Institute.
Restrictions on exportation have excluded small farmers and community groups from impoverished regions. “To export, a farmer needs to be able to produce pharmaceutical grade [THC] extract. It doesn’t matter if a community holds a license to cultivate if they can’t sell their product to a buyer,” says Juliana Salazar, a risk-consultant and analyst in the cannabis industry.
“What we’re seeing are communities locked out of the process because they don’t have the money to build the necessary infrastructure,” she says. “Internationals are dominating the market.”
Companies must apply for five separate licenses; permission for cultivation of both psycho-active (THC) and non-psychoactive (CBD) marijuana plants, a license for seed production, permission to manufacture cannabis derivatives (which for the moment are the only form of export Colombia allows) as well as the permission to export.
A spokesman for the Colombian Ministry of Health stated that the review process officially takes three to four months, but government requests for additional information or additional proof of claims are common and revised applications are placed at the end of the queue once updated. Multiple investors in the field told Toward Freedom that waiting times of 12-16 months are common.
For traditional farmers from conflict zones however, like co-op Caucacannabis, a co-op of 400 Indigenous Nasa families from the region of Cauca, the industry isn’t what they had hoped. “The transition from the illegal to the legal market has not been as easy as the government promised,” said Luis Alfredo Muelas, a farmer and founder of the organization. “We don’t have the infrastructure the internationals have. And as we wait for compliance, families that previously sold their crops informally are barred from participating in the industry at all.”
Joshua Collins is a freelance journalist and photographer based in Bogota, Colombia. For more of his stories on Latin America you can follow him on twitter.