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October 22, 2021

Uruguay plans to sell weed for $1 per gram to combat drug trafficking

Uruguay hopes selling legal marijuana at $1 per gram will put a stop to the illegal market, according to a local newspaper.

The government is attempting to create a legal marijuana industry that could start as early as the summer of 2014, the country's drug chief Julio Calzada told newspaper El Pais.

These plans passed in the lower house of Congress and President Jose Mujica expects that it will be swiftly approved in Senate. If that's the case, Uruguay will become the first country to attempt licensing and enforcing weed production, distribution and sales.

"The illegal market is very risky and of poor quality," Calzada told the Associated Press. The State "is going to offer a safe place to buy a quality product and on top of that, it's going to sell it at the same price."

It's expected that one gram will be enough for one marijuana cigarette or two to three thinner cigarettes. Sales will be restricted to locals and they'll only be allowed to buy up to 40 grams a month.

While marijuana has been legal in Uruguay for a while, you can be thrown in jail for growing, carrying, buying or selling the substance.

The debate continues over whether marijuana should be legalized. Liberal leader Justin Trudeau announced his stance on the issue during a visit to Kelowna, B.C. in July that was published on Youtube. "I’m actually not in favour of decriminalizing cannabis – I’m in favour of legalizing it. Tax and regulate. It’s one of the only ways to keep it (weed) out of the hands of our kids because the current war on drugs, the current model isn’t working," he says in the video.

Apparently, a Canadian senate committee recommended legalizing marijuana in a report produced 11 years ago, according to the CBC. The decriminalization is similar to prohibition of alcohol, according to the report, which ultimately was not effective.

But those who disagree are afraid that legalizing it will encourage drug use and it could even make harder drugs socially acceptable.

Meanwhile, the United States is testing the drug's legalization in the states of Washington and Colorado. Last year, the states legalized possession of marijuana for up to an ounce (28.35 grams) for adults over the age of 21. Voters will decide on how to set up the distribution system of state-licensed growers, processors and sellers.

Sales for the drug are expected to start in 2014, but Washington recently decided to place high taxes on marijuana and limit the state's total production to 80 tonnes. Colorado still needs to decide on its taxation rate and whether or not it'll set a production limit. Either way, marijuana sales are expected to bring in revenue for the government and early estimations put the drug's cost in Washington at $13 to $17 per gram.

As countries experiment with their marijuana laws, the rest of the world will be watching to see how the results are.

Do you think the marijuana industry should be legalized? Why or why not?

Josephine Lim, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...