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Private Sector Banks Putting the Squeeze on Uruguay’s Legal Marijuana Industry

Investment in the Cannabis Industry Grows
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On July 19, Uruguay started selling legal weed in pharmacies—making it the world’s first state-run marijuana marketplace with the government involved in the entire chain of movement from cultivation to purchase.

The problem however is that, at $1.30 per gram, the country has already run out of weed and it’s program has only been operating for less than a month.

From the very first day when sales started, there were shortages; some pharmacies were cleaned out before closing time.

Pharmacy owners say the situation continues and that their supply is gone almost as soon as it is delivered.

Some stores in the capital, Montevideo, where about two-thirds of the country’s 3.4 million people live, haven’t had a shipment since August 4.

According to the PanAmPost, the situation is even worse outside the capital.

What’s going on? Blame the banks.

In addition to the supply problem, it turns out, banks are closing the accounts of all companies connected with the sale of cannabis, which in Uruguay happens to be 22 pharmacies.

Private-sector banks have begun closing accounts by order of their overseas parent companies, claiming they would be subjected to sanctions if they did not.

While weed is legal in Uruguay, it is still illegal in the countries where the parent financial companies operate.

The issue even threatens Uruguay’s state-owned Banco República with its correspondents in the rest of the world.

The Institute for Regulation and Control of Cannabis (IRCCA for its Spanish acronym) is looking for ways to deal with this situation, which, if not solved, could make it impossible for pharmacies to sell marijuana.

According to El Observador, a source close to the country’s banking association said that a local financial institution has proposed that pharmacies have two bank accounts—one for their normal commercial activity and another for their marijuana sales.

Pablo Durán, legal counsel for the Pharmacy Center, said that some pharmacies may decide to undertake this complicated process in order to not be pushed out of the financial system.

“It is beyond absurd that the banks are able to sabotage a government measure like this,” said Miguel Taberne, Director of the Pharmacy Association of the Interior.

We, here in the United States, understand your pain as our banks refuse to provide financial services to the weed industry.

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