On Oct. 17, Canada will become a pioneer among developed nations and venture into uncharted territory.
With the legalization of recreational cannabis, Canada will open up an industry that Statistics Canada estimates to be worth $5.7 billion annually.
This could prove to be a massive windfall to the country in general, but small towns more specifically.
For context, Canada’s beer industry is worth an estimated $9.1 billion.
Imagine: an industry that isn’t even legal is already worth more than five billion dollars – or more than half of the value of a mature industry like the beer market.
When most people think of companies like Molson-Coors, Sleeman and Anheuser-Busch, we think of some of the most profitable companies that can afford $1 million for a 30-second Super Bowl ad. In other words: they’re doing fine financially.
The legalization of cannabis represents an actual once-in-a-lifetime opportunity. It’s not often that an industry already bringing in over $5 billion that operates outside of the law gets brought into the legal economic landscape.
The war on drugs has been fought by governments around the world and it appears drugs are winning quite handily.
Even in a place like the United States, where the term “war on drugs” was coined, several states have legalized cannabis with staggering economic results.
In just over three years, between January of 2014 and March of 2017, the state of Colorado raked in more than $500 million in tax revenue thanks to the sale of cannabis.
The state’s schools have benefitted to the tune of $120 million in additional funding. Substance abuse programs received more than $15 million while mental health initiatives got upwards of $10 million in additional funding.
All that money came from just the excise tax on cannabis products.
The potential for businesses and individuals is even greater.
One of the most exciting aspects of legalization is the fact that the demand is already there (18 per cent of Canadians – or 6.5 million people – admitted to using pot in the last year).
And that’s just the people who admitted to a pollster that they’ve consumed cannabis. Rest assured, the actual number of users is much higher.
If this many people are already buying a product that’s illegal, there’s a good chance that number will increase significantly if there is no threat of criminal charges.
The legalization of cannabis could have an especially large impact on rural regions like the Pontiac.
Smiths Falls, Ontario is a perfect example of this.
The town used to be home to the Hershey chocolate factory. In 2008, the plant closed down resulting in the loss of 750 jobs. Other businesses in town then fell like dominoes until 40 per cent of the town’s workforce was unemployed.
It’s a story that will sound familiar to Pontiac residents.
But it has a happy ending.
The former Hershey chocolate factory is now home to one of the world leaders in cannabis production.
Tweed is a cannabis production company that took over the old facility, which now employs over 500 people.
It’s resulted in a housing boom in the community along with a thriving small business culture.
Here in the Pontiac, several major industries have left the region. The job losses associated with those companies packing up and leaving have been devastating.
In the intervening years, many people have looked for a “silver bullet” solution that will bring those jobs back in one fell swoop. The proposals have ranged from a jail to government subsidies for the lumber industry.
None have come to fruition.
In December of 2017, LiveWell foods announced an ambitious plan for 600,000 square foot greenhouses in Litchfield at the Pontiac Industrial Park.
Progress is still ongoing, but the company has received provincial approval to move forward on the project. LiveWell also plans to construct what it calls a state-of-the-art research facility to go along with the greenhouses.
The Pontiac is well positioned to capitalize on what promises to be a lucrative industry.
An article in the Toronto Star recently noted that many of the emerging cannabis companies need space to ramp up production. This makes “rural areas or former manufacturing towns a natural fit for their operations,” the article said.
Sound familiar?
The Pontiac fits the bill for both of these criteria.
Although some people are wary of the impacts that legal pot will have on their community, one thing is obvious: whether it’s illegal or not, people are consuming cannabis.
Many people will choose not to partake, and that’s ok.
But for those who object to cannabis legalization on moral grounds, hopefully they can see that there are plenty of positives that can come from legalization.
Economically hard hit regions like the Pontiac have the chance to get in on the ground floor of an industry that could be seen as “blue chip” within a decade.
Is it the “silver bullet” solution that will revitalize the Pontiac? Maybe. Maybe not. But that doesn’t mean we can’t have high hopes.
Chris Lowrey
