Middle East Legal Cannabis Market Report Size, Share, Growth Drivers, Trends, Opportunities & Forecast 2025–2030

Middle East Legal Cannabis Market Overview

• The Middle East Legal Cannabis Market is valued at USD 0.9 billion, based on a five-year historical analysis. This growth is primarily driven by increasing acceptance of cannabis for medical use, supported by expanding access pathways for cannabis-based pharmaceuticals and medical marijuana products across selected Middle East jurisdictions. The rising demand for cannabis-based products, particularly in medical, pharmaceutical, and wellness-oriented CBD segments, has significantly contributed to the market's expansion.
• Key country-level contributors in this market include Israel, Lebanon, and selected Gulf and North African markets that import or regulate medical cannabis products. Israel is recognized for its advanced medical cannabis research ecosystem, structured patient access program, and established regulatory framework overseen historically by the Israeli Ministry of Health’s Medical Cannabis Unit (IMCA). Lebanon’s legalization of cannabis for medical and industrial purposes has positioned it as a producer of high-quality cannabis for regulated export and domestic value-add processing under a licensing regime. In parallel, Gulf markets such as the United Arab Emirates and Saudi Arabia are emerging as demand centers for tightly controlled, cannabis-derived pharmaceuticals and CBD wellness products distributed through regulated medical and pharmacy channels.
• In the United Arab Emirates, recent federal amendments have focused on clarifying the handling of narcotic and psychotropic substances, including cannabis derivatives, alongside a growing framework for permitting certain hemp-derived and CBD-based products under strict controls for import, formulation, and sale in wellness and cosmetic segments. The Federal Decree-Law No. 30 of 2021 on Combating Narcotics and Psychotropic Substances, issued by the UAE government, governs the control, licensing, and penalties related to narcotic substances, including cannabis, and sets the basis under which medical and wellness products containing controlled cannabinoids can be handled through licensed entities. Within this framework, patient access to cannabis-derived pharmaceuticals is channeled via approved medical prescriptions and authorized importers, while wellness-focused CBD and hemp products are subject to product registration, quality standards, and retail licensing requirements.

Middle East Legal Cannabis Market Segmentation

By Application:The application segment of the market includes various uses of cannabis, with medical use (prescribed) being the most significant, reflecting the dominance of regulated medical and pharmaceutical channels across the region. This sub-segment is driven by the increasing recognition of cannabis as a viable treatment option for various medical conditions, including chronic pain, epilepsy, multiple sclerosis, chemotherapy-induced nausea, and certain refractory neurological disorders. Pharmaceutical R&D and clinical trials are also gaining traction as companies and academic centers in Israel and selected Middle East markets invest in developing standardized cannabis-based therapies and drug-delivery formats. Industrial hemp is emerging as a sustainable resource for textiles, construction materials, food ingredients, and biomass feedstocks, particularly in countries that have legalized hemp cultivation for industrial and medical purposes such as Lebanon and parts of North Africa. Wellness and nutraceutical CBD products are becoming popular among health-conscious consumers through pharmacy, e-commerce, and specialty retail, especially where low-THC, hemp-derived CBD is permitted. The "Others" category includes veterinary applications, palliative and compassionate use programs, and institutional research supply, which are also contributing to market growth.

By Product Type:This segment encompasses various cannabis products, with oils, tinctures, and extracts leading the market due to their versatility, dose precision, and use in both medical prescriptions and wellness formulations. Dried medical flowers remain important for established patient programs, particularly in Israel, where inhaled and vaporized flower is widely prescribed under the national medical cannabis scheme. Capsules and oral solutions are gaining traction for their convenience, standardized dosing, and suitability for elderly and chronic-disease patients. Topicals and dermaceuticals are increasingly used for localized pain, inflammatory conditions, and dermatological applications, often formulated with hemp-derived CBD for over-the-counter use. The food and beverage sector is witnessing a rise in hemp-derived CBD products, including functional beverages, snacks, and fortified foods, in markets where such products are permitted and subject to food-safety and product-registration rules. The "Others" category includes various niche products such as transdermal patches, suppositories, and veterinary formulations that cater to specific patient and consumer needs.

Middle East Legal Cannabis Market Competitive Landscape

The Middle East Legal Cannabis Market is characterized by a dynamic mix of regional and international players. Leading participants such as Tikun Olam-Cannbit Pharmaceuticals Ltd. (Israel), Panaxia Labs Israel Ltd. (Israel), InterCure Ltd. (Canndoc) (Israel), BOL Pharma (Breath of Life Pharma) (Israel), IM Cannabis Corp. (Middle East Operations), Seach Medical Group (Israel), CANNDOC-Pharma Partnerships in the Gulf (Including UAE and Bahrain Distribution Partners), Pharm Yarok (Israel), Lebanese Regulated Cannabis Producers (Licensed Under Lebanon’s Medical and Industrial Cannabis Framework), Turkish Medical Cannabis and Industrial Hemp License Holders, UAE-Based CBD and Wellness Brands Operating Under Federal Regulations, Saudi Arabia-Regulated Importers of Medical Cannabis-Derived Pharmaceuticals, Qatar and Egypt Hospital-Linked Import and Distribution Consortia, Global Medical Cannabis Companies with Active Supply Agreements into Israel and the Wider Middle East, Regional Contract Research Organizations (CROs) Specializing in Cannabinoid Clinical Trials contribute to innovation, geographic expansion, and service delivery in this space.

Middle East Legal Cannabis Market Industry Analysis

Growth Drivers

• Increasing Legalization and Acceptance:The Middle East is witnessing a significant shift towards the legalization of cannabis, with countries like Lebanon and the UAE taking steps to regulate its use. In future, Lebanon legalized cannabis cultivation for medical purposes, aiming to generate an estimated $1.5 billion in annual revenue. This trend is supported by a growing acceptance of cannabis in society, with 70% of the population in the UAE favoring its medicinal use, according to a recent survey by the Dubai Health Authority.
• Rising Demand for Medicinal Cannabis Products:The demand for medicinal cannabis products is surging, driven by an increase in chronic health conditions. The World Health Organization reported that over 35% of adults in the Middle East suffer from chronic pain, creating a substantial market for cannabis-based therapies. In future, the medicinal cannabis market in the region is projected to reach $600 million, fueled by the growing acceptance of cannabis as a legitimate treatment option for various ailments.
• Expansion of Cannabis Research and Development:Investment in cannabis research is expanding, with several universities and private firms establishing R&D facilities. In future, the UAE government allocated $60 million to support cannabis research initiatives aimed at exploring its therapeutic benefits. This investment is expected to enhance product development and innovation, leading to a more robust market. The increasing number of clinical trials, currently at 20 ongoing studies, indicates a commitment to understanding cannabis's potential in healthcare.

Market Challenges

• Regulatory Hurdles and Compliance Issues:The legal landscape for cannabis in the Middle East remains complex, with varying regulations across countries. For instance, while Lebanon has legalized medical cannabis, other nations like Saudi Arabia maintain strict prohibitions. This inconsistency creates significant compliance challenges for businesses, as navigating the regulatory framework can incur costs exceeding $250,000 annually for legal consultations and licensing fees, hindering market entry and expansion.
• Stigma Associated with Cannabis Use:Despite increasing acceptance, stigma surrounding cannabis use persists in many Middle Eastern societies. Cultural perceptions often view cannabis negatively, impacting consumer willingness to engage with legal products. A recent study indicated that 50% of respondents in the UAE still associate cannabis with illicit activities. This stigma can deter potential customers and limit market growth, as businesses struggle to educate consumers about the benefits of legal cannabis products.

Middle East Legal Cannabis Market Future Outlook

The future of the Middle East legal cannabis market appears promising, driven by ongoing legislative reforms and increasing consumer awareness. As more countries consider legalization, the market is expected to expand significantly. Additionally, the integration of technology in cultivation and distribution will enhance efficiency and product quality. The rise of e-commerce platforms will facilitate access to cannabis products, catering to a broader audience and fostering a more informed consumer base, ultimately shaping a dynamic market landscape.

Market Opportunities

• Development of Innovative Cannabis Products:There is a growing opportunity for companies to develop innovative cannabis products tailored to local preferences. With the wellness market projected to reach $2 billion in the region by future, businesses can capitalize on this trend by creating unique formulations that cater to health-conscious consumers, enhancing market penetration and brand loyalty.
• Investment in Cannabis Tourism:The potential for cannabis tourism is significant, particularly in countries like Israel and Lebanon, where cannabis is becoming more accepted. In future, cannabis tourism could generate an estimated $400 million in revenue, attracting international visitors seeking cannabis-related experiences. This opportunity can stimulate local economies and promote cultural exchange, further legitimizing the cannabis industry.