North Macedonia — a cannabis superpower in the making?

Image by: jcomp

Cannabis consumption and cultivation isn’t the first thing that comes to mind when someone mentions North Macedonia. While the tiny Balkan country is looking to join the EU and has been a membership candidate for more than 14 years now, it isn’t big on tourism as some of other countries in the region, like Croatia or Montenegro, for example. Also, there aren’t any big or advanced industries in the country that could guarantee a sustainable economic growth. So, in an effort to boost its economy, there have been several developments in the past few months that suggest the country could be heading into a new direction regarding the lucrative cannabis business, which in 2018 was estimated to be worth around $13 billion.

Mysterious visit from a cannabis mogul

A mysterious visit from an American marijuana mogul towards the end of August was one of those developments. When millionaire entrepreneur Michael Straumietis, also known as “Big Mike”, visited the country, many were caught by surprise. But not the Macedonian government and its representatives, with whom Big Mike apparently had a lot to talk about. During the short stay, Big Mike met with Macedonian Prime Minister Zoran Zaev, Health Minister Venko Filipce, and a few local government representatives. While the government kept quiet about the discussions and offered a dull response that this was just a regular business meeting, Big Mike had a lot more to say about the talks he had with the Macedonian authorities.

“North Macedonia is full of hardworking and intelligent people ready for a change. Cannabis can be that change. With around 40,000 potential new jobs after legalization, there’s a huge opportunity for North Macedonia — if they do it right,” Big Mike wrote in an Instagram post, published on September 10, along with a short video from his meeting with Zaev.

Even though Zaev was grilled for several days by opposition MPs in the Macedonian Parliament about his talks with Straumietis, he didn’t reveal any details about his discussions with the marijuana mogul.

“That’s why I spoke directly with the prime minister about fair cannabis licensing and how to create a clear pathway into the European marketplace. With cost-effective land, electricity, and water, #NorthMacedonia is a prime location for a cannabis boom,” the American businessman added in the Instagram post.

In another post titled “My trip from Europe’s new Cannabis superpower,” Straumietis, who has 2.7 million followers on Instagram, pointed out that he cannot wait to “return and continue to strengthen my partnership with this new opportunity for North Macedonia and the Cannabis community.” It wasn’t his first time in the Balkans, though — in the past, he had been to Bulgaria, where he had a team of researchers studying the medical benefits of the cannabis plant.In an interview he gave for Bulgarian media back in 2013, Straumietis said that the main reason why he choose Bulgaria, was that the country had many good scientists who could do the research he wanted.

Bulgarian authorities are still reluctant when it comes to legalizing medicinal cannabis. They only allow cannabis cultivation of limited quantities for medical and scientific research, so Big Mike’s presence in the country is basically limited to that extent. However, he has stayed for a while in the country, and in 2012 he founded a charity called “Holiday Heroes”, which supports socially disadvantaged families, elderly people, single parents and persons with disabilities.

Big Mike’s road to success

Oregon-born 59-year-old Straumietis, CEO of Advanced Nutrients, has a long history in the marijuana world. Big Mike claims that he now owns the “most powerful privately held company in the marijuana business world.” Straumietis went into the marijuana business when he was just 19 years old. After learning how to illegally grow and traffic marijuana during the early 1990s, he also earn himself several run-ins with the law in the U.S. Then, in 1996, he moved to Canada. And three years later, he founded Advanced Nutrients, a hydroponic fertilizer company. Hydroponic fertilizers are essential for the growing technique for plants, and as Big Mike says, Advanced Nutrients had the goal of creating better hydroponics nutrients and equipment that would allow growers to gain more success and bigger profits.

Two decades into the business, the company makes over $110 million a year from selling its marijuana-specific supplements and medical marijuana products in over 93 countries. And it was Big Mike’s innovative marijuana growing techniques, over 50 of them, that helped him build an empire, which he is now looking to expand.

No matter how unlikely a destination North Macedonia may sound, when Straumietis sees a business potential, he goes for it. And the potential is there, as he wrote in an Instagram story, for the partnership with Macedonian authorities to “grow the cleanest, healthiest and most potent cannabis the world has ever seen.” The country’s favorable climate and agriculture conditions, and the big number of sunny days throughout the year, also suggest that North Macedonia could be optimal for cannabis cultivation. Currently, cannabis in North Macedonia is grown on an area of 140 thousands square meters. Being the only country in the region that has legalized the medicinal cannabis cultivation, also gives the country a good advantage in positioning itself on the market.

“I know cannabis will save lives and even pull countries out of dark times,” Big Mike pointed out in another post after meeting up with the authorities.

A business opportunity worth exploring

While the Balkan country is looking to boost its fragile economy, expanding into the medical marijuana business could be worthwhile. Even Prime Minister Zaev himself called on entrepreneurs to get involved in the industry, expecting a profit of more than 100 million euros.

Growing cannabis for medicinal purposes has been legal in the country since 2016. During the past two years, 28 companies got licensed for growth and production of cannabis oil, some of them owned even by Prime Minister Zaev’s relatives. MAM, a company based in the small town of Sveti Nikole, has 30 employees and is owned by the Prime Minister’s cousin Trajce Zaev. And there are plenty of businesses like MAM in the country, hoping to get a slice of a global market that could be worth up to $50 billion over the next five years.

When it comes to actually making a profit out of the medicinal marijuana business, things haven’t gone as smoothly as the companies might have hoped. For one, there isn’t a law that would regulate the export of the dried cannabis flower — which is one of the most precious exports of the business.

According to some of the farmers, a kilogram of dried marijuana flower is estimated to be worth up to four thousand euros. Most of the companies already have already produced around half a tonne of it, which could be worth a whopping 45 million euros in total. Only a few of the companies extract cannabis oil, which is allowed for exporting under the existing law.

According to the medicinal marijuana producers, the law also requires that companies have a bank guarantee of one million euros and at least 15 employees, which significantly increases start-up costs. But recently, the government announced that it is ready to make the changes in the existing law. Should this be done soon, it will attract even more companies to enter the fray.

Another problem, however, would be investing in the technology needed for setting up production, since the government hasn’t provided sufficient guidelines yet, farmers claim. But, this is precisely where Big Mike’s expertise could come in handy.

Legal recreational use still remains out of reach

Much of Big Mike’s businesses also focuses on the sale of marijuana for recreational use. However, Macedonian authorities are not yet ready to discuss this topic. Although Health Minister Filipce noted that he expects that the cannabis industry will play an essential part in North Macedonia’s economy, when it comes to legalizing marijuana for recreational use, the country is still far away from that step, he said. As Filipce pointed out, what the country lacks at this point are “strong control mechanisms” that would regulate this area. While the country also is looking to start the accession negotiations with the EU during next year, authorities have kept the marijuana legalization debate quiet. For the time being, they are focused on more pressing issues instead, such as the fight against corruption and the rule of law.

And Macedonian authorities have been rather harsh with those that have advocated for the idea. Recently, an outspoken activist for marijuana legalization was sentenced to a year in prison. Monika Ristovska was held in detention since the summer after the police arrested her for the possession of 15 grams of marijuana. Ristovska is a vocal supporter of marijuana legalization, often staging guerilla actions such as smoking a joint in public or making a live broadcast of smoking marijuana on social networks.

While various non-governmental organizations have also called on authorities to follow the global trends of marijuana legalization, it seems that such a decision is still far off. Almost all of the Balkan countries are on the same page when it comes to this issue, so it’s hard to predict when the authorities in the region might take a different approach towards marijuana legalization. But, should the medical marijuana business in North Macedonia turn out to be a profitable one, it could start a new trend in the region, especially when most of the Western Balkans countries, in the absence of an EU membership, are looking to strengthen their weak economies.

Freelance journalist based in Skopje, Macedonia. Contributor for @ZDNet and @ForeignPolicy

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