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Munro-Knight: New US President key to herb funding future

by Marlon Madden
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There are still concerns that Barbados could potentially lose out on major investments in the medicinal cannabis industry if accommodations are not made in the banking industry soon for funding projects and facilitating banking and transfer of proceeds.

This is according to Chief Executive Officer of the Barbados Medicinal Cannabis Licensing Authority (BMCLA) Dr Shantal Munro-Knight, who told reporters that investors were asking questions relating to banking.

Stating that most international investors did not mind paying the application fee and even losing it while hoping that the banking issue would be worked out by the time licences have been granted, Munro-Knight said “What happens if you don’t [get it sorted]? The investment just moves somewhere else.

“That is why I say it is something we have to figure out or we can potentially lose the investment. In other jurisdictions in the region they have been able to have some accommodation, not that it is not still difficult for them, but there is some accommodation in those jurisdictions that have a national bank.

“So through the national bank, some levels of investors are able to bank monies, not necessarily take loans but are able to bank money within the national bank. So it is something we will have to contend with,” said Munro-Knight.

However, she said she was aware that it was a matter that lawmakers “at the highest level” were currently working through.

“The potential for us to have this industry that can add such tremendous value is one that should provide some impetus for all the necessary players to pay attention to the issue.”

Stating that she did not have the answers to the issue of banking when it came to the medicinal cannabis industry and that it was a “global problem”, Munro-Knight said a lot of it was hinged on what policy direction the new President of the United States takes.

“It is something that we have to watch in terms of what will happen with this new presidency within the US and the extent to which the banks are now more amenable given the recent rescheduling that has happened at the international level. It is then a dialogue we intend to have with the banks to assess it,” said Munro-Knight.

There are still concerns in the US that contact with money that can be traced back to state marijuana operations could be considered money laundering and expose a bank to significant legal, operational and regulatory risks.

In addition to similar concerns locally and regionally, banks here also have to contend with the fear of de-risking – the termination or restriction of business relationships with clients or categories of clients to avoid risk as outlined by the Financial Action Task Force.

Pre-COVID it was estimated that Government could earn as much as $1 billion per year from the industry through various methods including applications and licences, as well as duties and taxes.

However, Munro-Knight made it clear that she was not prepared to give any estimates of what the national contribution from the industry could be, especially given the current global health pandemic.

“Certainly, I think that there is tremendous potential for this industry to really contribute nationally, not only in the context of just fees from licences but the potential for jobs and the potential that this industry has to touch so many different areas, even in the area of tourism,” she said.
(marlonmadden@barbadostoday.bb)

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