The country’s legal marijuana business — a rarity in Asia — is struggling with oversupply, illegal imports and regulatory ambiguity. Investors are piling in anyway.

In Bangkok these days, it’s hard not to notice the weed dispensaries catering to tourists that have multiplied since the government decriminalized the drug last year.

Many of them take advantage of lax regulations to openly sell visitors dried marijuana flowers that have been imported illegally from Canada or the United States. On a recent afternoon, one shop advertised its pungent offerings — weed strains with names like “Ice Cream Cake” and “Lemon Cookies” — as “California’s finest.”

But such dispensaries may be soon be out of business because of competition, oversupply and expected new regulations around the drug’s cultivation and sale, several cannabis industry experts said in interviews. The survivors will sell high-quality, domestically grown weed, which helps explain why investors have been plowing millions of dollars into high-tech indoor cannabis farms across Thailand.

Although no one knows what kind of regulations the nation’s newly elected leadership will usher in, cannabis industry experts said the rules will most likely give investors more clarity and raise the bar to market entry in a way that benefits businesses with the best domestic supply chains.

“Smart money’s going to come in,” Sirasit Praneenij, a co-chief executive of the marijuana farming company Medicana, said recently at an indoor cannabis farm in outer Bangkok. [Read More @ The NY Times]