The Economic Boom of Cannabis in Colorado, Washington, and Canada

Cannabis becomes hot issues in this era since a lot of countries legalized cannabis to be consumed not for health purpose but for recreational purpose, the law that legalizes weed has few restrictions to prevent overdose.

Legalization of cannabis has produce pro and cons, most people that pro with the law give argument what the difference in consuming alcohol or smoking a cigarettes, it’s the same use for giving pleasure, while the con they argue that the chemical contains inside cannabis can damage the user brain, while alcohol and cigarettes have a clear rule regarding about the consumption.

The pro and con have their own perspective, this article will inform about how cannabis legalization can affect the economy especially in Canada, Colorado/Washington and some other states.

2012 has become the history of Colorado states, where voters have passed the Amendment 64, where it will legalize the consumption of cannabis for recreational purpose, the trend continues until 2018, where 29 states legalize cannabis for the recreational purpose include Washington DC.

The economic effect of cannabis legalization can be seen by comparing the income that the states receive in the past 6 years before cannabis legalization and 6 years after cannabis legalization.

According to BEA data, Colorado GDP has increased from year to year.

YearGDP (Billion)Increase or decrease
2006$243.172
2007$250.2522.91%
2008$252.5580.92%
2009$247.270-2.09%
2010$248.6670.56%
2011$252.2561.44%
2012$257.622
The year Amendment 64 passed2.13%
2013$265.8803.21%

The graph above show the GDP for Colorado states during the last 6 years before cannabis legalization, the states do not have any significant increase from 2006 to 2012 the highest rate recorded was 2.91% in 2007 compared to 2006.

YearGDP (Billion)Increase or decrease
2013$265.8803.21%
2014$278.2814.66%
2015$286.7283.04%
2016$292.5122.02%
2017$303.4293.73%

The graph above shows that amendment 64 has a great impact on the Colorado economy where in 6 years after cannabis legalization the Colorado states have not yet record any negative changes to their GDP.

2014 the sales of cannabis in Colorado recorded to $683 million dollars in 1 year sales of cannabis and in 2017 it is recorded exceeded of $1.5 billion sales for both recreational and medical purpose, since 2014 until 2017 government increase their tax rate from 10% to 15% this tax rate give more than $243 million dollars income to Colorado state. The total sales of cannabis across US country recorded nearly $9 billion dollars according to DBS analysis.

Canada just legalizes the cannabis under C-45 amendment in 2018, before C-45 pass cannabis is illegal in the country, according to the research conduct by the government they found out that illegal cannabis market value at more than $6 billion dollars in a year, where the money only goes to certain gangster or mobs.

Canada government takes initiative to legalize cannabis by using C-45 amendment considering the market value and the effect for the country income from tax, the other source income for Canada according to expert analysis in Canada will open opportunity for investor especially from the US to make their own cannabis production freely, this will increase the country economy.

Countries that legalize cannabis has recorded a significant increase in their economic, according to Bloomberg US able to create more than 200 thousand work field and in 2026 they predicted it will increase by 10 folded, the unemployment rate has decreased from 11.4% to 7.4%.

Uruguay as the first country that legalizes cannabis in 2013 recorded $3 billion in sales wide nation, the biggest effect is decrease the drug trafficking, since the price of weed very low while black market sells very high.