Bowe: Would cannabis industry be bankable?
As debate continues around the decriminalization of marijuana, Clearing Banks Association President (CBA) Gowon Bowe said the conversation should focus on how The Bahamas would mitigate the possibility of creating another cash only, underground economy.
Bowe said while decriminalizing marijuana poses remarkable new business and industry opportunities, the overarching question should be: can this industry be banked?
“It is legal in more than 30 states in the U.S. but is still a federal crime. So, banks in the U.S. are still not permitted to accept funds because it is the banking of proceeds from a criminal activity,” he said in an interview with Guardian Business.
“Canada, which has legalized it on a federal or national level, is still very mindful that it cannot do business in the U.S. with these same clients, because even the large banking institutions, they bank them in Canada because yes, they are legal but they are not able to transfer any funds in those entities into U.S. institutions and vice versa.”
It’s an important factor, according to Bowe, given The Bahamas’ vulnerability to sanctions by international financial watchdogs.
“Domestically, having it legalized and saying we can potentially cultivate it, grow and create new industries, that’s a fantastic possibility, but we have to also think, will it be able to be banked,” he said.
“Will it be able to be used in day-to-day activity or is this going to be another cash industry that will raise concerns? And that’s not to dampen, that is to say the debate is solely not about the product. We need to break into its constituent parts.”
The Bahamas National Commission on Marijuana expects to travel to Jamaica and Canada in the coming months as it prepares to submit its report recommending whether The Bahamas should declassify the plant as a dangerous drug.
The CARICOM Regional Commission on Marijuana has projected The Bahamas could see a financial benefit of around $5 million from the legalization of the substance and regulation of its sale.
“I believe that sometimes we let this debate get clouded by emotional tugging as to moral authority, and should the government be laying down laws to what it is I can and cannot consume. It is not as simple as that from a government perspective,” Bowe said.
“They have to think about the geopolitical consequences… From a business perspective there are opportunities but there are also a number of areas that have to be cleared and if the great United States, which has legalized it in states but not federally, and the banks in the United States are still having grave difficulty around banking it, then it’s not going to be easy for us that are relying on a North American banking system and European banking system. Sometimes it requires a great change.”
Paige started working as a business reporter in August 2016.
Education: Palm Beach Atlantic University in 2006 with a BA in Radio and Television News
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