Harvard Business School alum and retired Coca-Cola executive Vicente Fox was not big on weed during his time as president of Mexico – he served between 2000 and 2006. However, in recent years, he’s become a vocal advocate of marijuana legalization as he learned about the plant’s medical potential and realized the economic implications legalization could have.
“Only when we proceed to legalize we will see this business taken away from traffickers’ and cartel’s hands, and put in the hands of entrepreneurs, allowing for planning, regulation, a market, strategy… all of the tools available in the [legal] business world,” he told me in a conversation we had back in 2017.
Since we last talked, Mr. Fox’s views evolved considerably, along with the Mexican legal cannabis market, where medical marijuana sales have already commenced, and recreational cannabis legalization is closer than ever as the Supreme Court, ruling party and new president support the initiative.
In the past year, Mr. Fox was also added to advisory boards at pot publishing powerhouse High Times, and Latin America-focused, publicly traded, cannabis company Khiron Life Sciences. Mr. Fox assures Khiron has great potential in the region, as it gets ready to roll out its patient-focused products in Mexico and continues to grow high-quality, low-cost cannabis in Colombia.
Interested in getting Mr. Fox’s updated thoughts on this issue, I sat down with him for a brief pow-wow.
Meeting Mr. Fox
Meeting Mr. Fox is always fun – even though our opinions differ widely when it comes to Latin America’s economy. Ideological dissimilarities aside Mr. Fox is as congenial and amiable, as he is knowledgeable and opinionated. So, conversations are always entertaining.
Author’s note: I conducted this interview in Spanish and translated it for exclusive publication on Forbes.
After a few minutes spent laughing, remembering our previous encounters, where he’d called President Donald Trump a “myopic, ignorant knucklehead,” among other niceties, and talked about a regulated international cannabis trade, we hopped into marijuana in Mexico.
Despite being an overt critic of Mexico’s new president Andrés Manuel López Obrador, especially when it comes to economic policy, Mr. Fox acknowledges the country is “very dynamically advancing in all things related to the total legalization of cannabis.”
In fact, Mr. Fox believes Mexico will soon become the third country in the world to legalize recreational cannabis, only trailing Canada and Uruguay. “This positions Mexico to become a leader in world markets, when it comes to cannabis,” he said, bringing up Khiron’s “unique position” to benefit from this situation.
Now, what should cannabis businesses and entrepreneurs interested in getting into the industry in Mexico know about the country?
The first thing investors and entrepreneurs need to understand is that, unlike the U.S., Mexico is going for a federal legalization of cannabis, he said. “For an entrepreneur this is a clear signal that the market will be huge.” In fact, Mr. Fox believes Mexico’s market will be much larger than Canada’s or even California’s, as the Latin American country has more than triple the population of its Northern counterparts, at 150 million people.
“It’s also important for investors to understand that the cannabis industry has high return rates for the time being, especially in emerging markets. So, cannabis investments in Mexico can be recuperated much faster than usual,” he continued. “We still have 5 to 10 years of high profitability still ahead of us.”
But for Mr. Fox, the medical marijuana market has even bigger potential than the recreational market. In his view, the medical side of the cannabis industry is, to a certain extent, recession-proof. People will almost always prioritize medicine, no matter how bad the economy gets, he said.
An International Cannabis Trade
With the Israeli parliament recently passing a law that allowed for the export of medical cannabis, and Colombia and Canada approving the first shipment as well, I wondered what Mr. Fox thought about international cannabis trade. How will it look like?
“This is an irreversible trend. The cannabis market will be global in due time,” he responded. “Cannabis will soon be a powerful, employment-generating, wealth-generating, sector. So, this sector, just like industrials, cars, or tech, will become increasingly attractive.”
By means of conclusion, he explained that, while regulation for Mexico to export cannabis is pending and we still don’t know how that will look like, when rules do come out, he envisions “a wide open market for cannabis imports and exports,” within the NAFTA and beyond.
“Mexico is a famously open country when it comes to commerce,” he ended. “We already have more international trade agreements than any other country in the world… Cannabis should be no different.”
Illustrations based on the encounter with Mr. Fox, by Bocha Barrena.