Tackling a taboo: Cannabis tech on the rise in Asia

Drugs such as cannabis are considered taboo in Asia, especially in Singapore, where airplane disembarkation cards are printed with “Warning: Death penalty for drug traffickers under Singapore law.”

But despite the stigma, attitudes toward marijuana have recently started to change in the region. Following the liberalization of the drug’s use across North America and Europe over the past decade, there have been signs of increasing social acceptance, easing regulations, and even steps toward legalization in countries such as Thailand, South Korea, Japan, and Malaysia.

Subsequently, the “green gold rush” began, with both startups and nations eager to share in the windfall. A report by cannabis research firm Prohibition Partners projected Asia’s legal cannabis market to reach US$5.8 billion by 2024. In the same vein, Future Food Asia estimates the total sector, which includes recreational marijuana and hemp, to be worth US$12.5 billion by that year.

Another mind-boggling statistic: Asia is home to the highest number of cannabis users in the world, standing at an estimated 86 million in 2019, according to Future Food Asia. These numbers exceed North America and Europe, despite the two continents moving earlier to decriminalize the use of cannabis. Asia’s total count is set to grow even further, with increased access to medical marijuana and the continued easing of regulations in the region.

Even in Singapore, which punishes drug traffickers with an iron hand, interest in cannabis derivatives is blossoming. Called cannabinoids, these chemical compounds are found in the cannabis plant and can be used therapeutically. The substance has been the subject of research by the government’s National Research Foundation, which launched a S$25 million (US$19 million) initiative in 2018 to look into producing the compound, without “the need to grow the plant.”

Large cannabis corporations in North America are also branching out into the Asia-Pacific region to get their share of the potentially huge market. For instance, Canada’s Canopy Growth, the world’s largest cannabis company, took root in Australia in 2018 to expand its footprint in the region.

Another Canadian cannabis producer, Bluesky Biologicals, also expanded to the land down under in 2018, while establishing its hemp growing facilities in China, where it grows some 20,000 acres of the plant.

In February 2016, Australian authorities gave the green light to medical marijuana, opening the floodgates to investment opportunities and cannabis-related businesses. As a result, the Australian Stock Exchange (ASX) has seen a flurry of pot-related stocks make gains in the last couple of years.

It’s a “no-brainer” for big cannabis corporations to make inroads into Asia Pacific, says Kitty Chopaka, the founder and CEO of cannabis-focused consulting firm Elevated Estate. “Asia has a great climate and lower labor costs,” she says. “It’s also a very big untapped market, unlike in the US and Europe, where the cannabis market has matured.”

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