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Thursday, Feb 22, 2024
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.


Canadian cannabis industry sends letter to Ottawa to be part of $10B relief fund

Backed by three MPs, the cannabis sector is calling on the Trudeau government for equitable access to federal COVID-19 stimulus funding

MPs, 74 industry reps call for Justin Trudeau to include cannabis in federal relief funds
Photo inside Tantalus Labs’s SubLab facility by Nick Laba July, 2019

Three members of Parliament and 74 Canadian cannabis industry professionals are calling on the federal government to include the cannabis sector in Ottawa’s COVID-19 relief funds.

Last week, Tantalus Labs CEO Dan Sutton tweeted the cannabis industry was being excluded from the federal government’s $10 billion in loans to support the Canadian economy.

Read more: Justin Trudeau’s business bailouts gives cannabis the cold shoulder 

On Thursday, Vancouver Kingsway MP Don Davies sent a letter to Minister of Finance William Morneau calling the exclusion “economic stigmatization” while urging for federal support of the cannabis industry. The letter was co-signed by MP Nathaniel Erskine-Smith and MP Scott Reid. All three MPs co-chair the Parliamentary Cannabis Caucus. 

The next day, a letter on behalf of the regulated Canadian cannabis industry was sent to Morneau and Navdeep Bains, the Minister of Innovation, Science and Industry, calling for the same thing. This letter was signed by 74 industry representatives, including people from industry heavyweights Aurora Cannabis, Canopy Rivers, The Green Organic Dutchman and Tilray. 

Prime Minister Justin Trudeau’s $10 billion Business Access to Credit Availability Program pledges to prop up the economy as companies struggle through closures, layoffs, social distancing measures and additional sick leave. Loans will be distributed to the private sector through two Crown corporations, the Business Development Bank of Canada and the Export Development Bank. 

But those funds aren’t accessible to the cannabis industry, as Sutton learnt when his company’s application for relief funds to the BDC was rejected because the bank was “not authorized to do business with cannabis companies.” 

In his letter, Davies said cannabis companies already struggle to access credit and capital because of stigma against the federally regulated industry. Therefore, he stressed, it was very important for the industry to be able to access relief funds. 

“Canada’s cannabis sector has contributed over $8 billion to our country’s gross domestic product since legalization and it employs over 9,000 Canadian workers,” Davies wrote. The industry is also new and, “like other Canadian businesses, need support from the federal government to weather the economic impacts of COVID-19.” 

In the second letter sent to Morneau, on behalf of the regulated cannabis sector, its employees, shareholders, customers, patients and companies, signatories called on the government to do two things. 

First, the industry asked for support to keep their employees employed because wage subsidies, announced by the federal government March 18, don’t apply evenly across the industry. And second, the industry wanted to be able to access Trudeau’s $10 billion in stimulus finding. 

“We are not asking for special treatment, but rather equitable treatment,” reads the letter. 

When reached for comment last week, BDC spokesperson Jean Philippe Nadeau wouldn’t tell Mugglehead why the Canadian Crown corporation was excluding cannabis, only that it was watching the evolving situation closely and monitoring the needs of entrepreneurs and specific industries. 

Top image: The cannabis industry’s 9,000 employees face uncertain futures without support from the federal government. Photo inside Tantalus Labs’s SubLab facility by Nick Laba July, 2019


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