Misiones to Close State Cannabis Firm to Cut Costs and Boost Efficiency

The government of the province of Misiones has decided to close the provincial medical cannabis company in order to improve state efficiency. “I have decided to proceed with the dissolution of MisioPharma, ordering the cessation of its operational functions,” Governor Hugo Passalacqua announced Monday morning via his social media account.

The decision to close the public cannabis company had been made public hours earlier

Decree 539 appeared in the Official Gazette of Misiones, outlining the reasons and consequences of the closure. The measure had been anticipated to Infobae by a high-ranking source weeks before. It aligns with the privatization of the port of Posadas.

The governor explained that the step taken by his administration is part of the “necessary evolution in the face of a global market that, unlike six years ago, is now normalized and mature .” This new scenario, he argued, allows for “more agile and economical access to supplies.” To achieve this, he added, they are using “private production techniques that are more efficient than those of a state-run structure.”

The regulations issued by the Misiones Executive Branch cited other reasons, including “the prolonged and deep recession our country is experiencing.” In this context, there has been “a virtual breakdown of payment chains.” This breakdown “in turn acts as a feedback loop in the process of deteriorating economic activity.” These circumstances increase “the risk that state-owned companies will register losses in their share capital,” the decree stated.

He then added that there is a “critical economic and financial emergency” in the country. This constitutes an “exceptional circumstance.”

In this context, achieving the objectives set for the cannabis company MisioPharma becomes “impossible”

According to the governor, there is a “critical situation of economic and financial emergency
Passalacqua clarified in his statement that the vast majority of the company’s employees will not lose their jobs. They will be reassigned to Biofábrica Misiones, another state-owned company dedicated to the development of agricultural biotechnology.

“Our priority is the absolute optimization of public resources,” the governor emphasized. For this reason, “unnecessary operating costs” have been eliminated. The goal is to “redirect the budget toward critical areas,” he added. This ensures “an efficient and responsible government,” he stated.

Top sources told this publication that the cannabis company’s closure will represent annual savings of $1.5 billion .

What was MisioPharma?

The public cannabis company was created by Passalacqua himself at the end of his first term (2015/2019).

MisioPharma was responsible for the production, processing, and marketing of cannabis and its derivatives. Its founding charter also authorized it to install and operate the necessary facilities, equipment, and industrial plants for these purposes.

MisioPharma could also acquire, process, and manufacture all related products. This list included cannabis seeds, cannabis plants, compost, plant protection products, fertilizers, and other necessary resources.

It was authorized to transport, store, and distribute them. It was also authorized to market, export, and import them.

What are the next steps?

The articles of decree 539 establish a series of stages to proceed with the closure and liquidation of MisioPharma.

The regulations stipulate that it will remain operational until Thursday, April 16th, at 9:00 a.m. On that day, State Prosecutor Eduardo Duarte will take the necessary formal steps for its dissolution.

The cannabis company is a state-owned enterprise. Therefore, 100% of the shares are held by the government. The official will sign the closing document on behalf of this capital. Following this, he will appoint Francisco Malica as liquidator.

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(Featured image by David Gabric via Unsplash)

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First published in infobae. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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