Gabriel Abed: “Bitt was built on rawness, doubt and uncertainty.”

THE STAR BUSINESSWEEK DECEMBER 21, 2019

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IN THIS EDITION OF

GABRIEL ABED:

“Bitt was built on rawness, doubt and uncertainty.”

Barbados-born Gabriel Abed is the founder of Bitt, a home-grown tech company that aspires to deliver technology innovation accompanied by social inclusion within the financial arena. With the aim of building a business of which all Barbadians — and Caribbeans — could be proud, the story of Gabriel’s journey, from the earliest days of his business career to today, is one that has involved many twists and turns, and lately a lot of triumphs.

Continued on page 4

BY ED KENNEDY, STAR BUSINESSWEEK CORRESPONDENT

Gabriel Abed is Founder of Bitt, the Barbados-based financial technology company

SBW THE STAR BUSINESSWEEK

Geopolitics in 2020 “The only constant in life is change.”

In today’s turbulent world the words of Greek philosopher Heraclitus have never been more apt. Elections, shifting global alliances, redrawn trade lines and a slowing global economy – 2020 will be a year of change and the Caribbean must evolve and adapt accordingly.

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British Prime Minister Boris Johnson won re-election on December 12, giving renewed impetus to Brexit (Photo courtesy Number 10)

Calculating a Crypto Future in the Caribbean The tail end of every decade inspires reflection and careful consideration of what may unfold in the years to come.

As the current financial architecture of the Caribbean is increasingly under siege from threats like de-risking and the increasing costs of compliance, many in the region hope the coming decade will bring increased efficiencies, not less.

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GEOPOLITICS

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GEOPOLITICS IN 2020

BY CATHERINE MORRIS, STAR BUSINESSWEEK CORRESPONDENT

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The White House may welcome a new administration next year with US elections slated for November 2020 (Photo courtesy the White House/Andrea Hanks)

“T

he only constant in life is change.” In today’s turbulent world the words of Greek philosopher Heraclitus have never been more apt.

Elections, shifting global alliances, redrawn trade lines and a slowing global economy – 2020 will be a year of change and the Caribbean must evolve and adapt accordingly. STAR Businessweek breaks down the external shocks that are likely to impact the region over the next year.

ELECTION FEVER In 2020 America will be gripped again by election fever as voters go to the polls in early November. Whether it’s a win for the Republicans or the Democrats take back power, one thing is certain: the country will become even more polarised. This divisive rhetoric and uncertainty is bad for business, bad for the global markets and potentially bad for the Caribbean which has typically enjoyed a close relationship with its superpower neighbour.

The Democrats are still a long way from picking their candidate but it’s fair to say that whoever the nominee, taxes will be a central issue. A hardline stance from Democrats will be punitive for high net worth individuals – a prime

market for many areas of the Caribbean which rely heavily on foreign investors in sectors such as real estate, energy and tourism.

If the current efforts to impeach Trump are unsuccessful and the controversial leader takes another term, the US State Department will continue with its current Caribbean agenda which focuses on co-operation in energy investment, trade, educational and health initiatives and security. It’s the latter that has been a particularly hot button issue for Trump’s administration which doubled down on protecting America’s borders, from both illegal immigration and security threats.

If the Caribbean cannot get a handle on its escalating crime, the region could face more tourism warnings and harsher restrictions over travel, work or study visas for the diaspora.

The adversarial relationship Trump has cultivated with China will also impact the Caribbean further if his tenure continues, with the two powers attempting to carve up the region through investment, diplomatic overtures and development assistance. The Trump government has shown a marked softening in its stance towards Taiwan, which sets the stage for greater investment in Saint Lucia, Taiwan’s strongest ally in the Caribbean.

Continued on page 6

FUTURE OF PAYMENTS

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DECEMBER 21, 2019

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CALCULATING A CRYPTO FUTURE IN THE CARIBBEAN

BY ED KENNEDY, STAR BUSINESSWEEK CORRESPONDENT

T

he tail end of every decade inspires reflection and careful consideration of what may unfold in the years to come. As the current financial architecture of the Caribbean is increasingly under siege from threats like de-risking and the increasing costs of compliance, many in the region hope the coming decade will bring increased efficiencies, not less.

But first, a brief primer on the definition of cryptocurrencies from well-known finance website Investopedia: “A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology – a distributed ledger enforced by a disparate network of computers. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.”

CRYPTO IN THE CARIBBEAN Although futurology, by its nature, is always an inexact science, in many areas of commerce there can be a cautious predictability about expected future directions. Cryptocurrency requires a different calculation. If the Caribbean family wants to capitalise on this growing technology, it first needs to identify crypto’s unique utility to the region and how its development can be nurtured with a view to wider adoption.

Last year, while the rest of the world was experiencing what spectators dubbed CryptoMania – AKA the Crypto Frenzy – a quiet revolution was beginning in the Caribbean. Just as Bitcoin’s falling value during the middle of last year evidenced that a chapter of the crypto craze was nearing an end, numerous nations

asset benchmark administrators, digital asset trust service providers and digital assets derivatives, DABA established a formal framework for the governing of businesses engaging in crypto activities.

Such moves by Bermuda are clearly bold to those who still feel ‘the jury is out’ on the long-term value of cryptocurrencies, but the work of lawmakers in Hamilton looks positively modest compared to plans being made in Puerto Rico. The US territory has become an epicentre for crypto ‘true believers’ who envisioned in the island’s most recent post-hurricane recovery period a chance to help rebuild the territory while building a new city called ‘Sol’ (formerly ‘Puertopia’). The idea was a city where all money used would be digital, all contracts would be public and, in the absence of a central bank printing and circulating money, individuals could create their own currency and avoid the need to pay any taxes. For now, much of these goals remain dreams.

Which Caribbean nations are converting crypto’s potential into real outcomes?

around the Caribbean were laying the groundwork for greater crypto integration with ambitions for its permanent and ongoing use.

COMPOUNDING INTEREST IN CRYPTOS In August 2018 the European nation of Malta announced it would no longer accept cryptocurrencies as payments in the island’s Individual Investor Programme (IIP) that has been used by foreigners to become eligible for economic citizenship. By contrast, within the Caribbean one month earlier, an amendment to Antigua and Barbuda’s Citizenship by Investment Program Act permitted payment in cryptocurrencies.

In February 2019 the Eastern Caribbean Central Bank (ECCB) announced it would commence a trial of a central bank digital currency,

potentially leading to the world’s first deployment of a central bank digital currency. The project is enabled through a partnership with Barbados’ Bitt and the aim is an eventual full rollout as a currency of legal tender, potentially as soon as 2020. The experiment is called the ECCB Digital Currency Pilot Project and will cost an estimated XCD$ 8mn from piloting to implementation.

In more recent months there has also been progress in the space of routine payments. Via utilisation of the USDC stablecoin pegged to the USD, Bermudians can now pay their taxes in cryptocurrency. This reform is one area of many that Bermuda has pursued to make it more crypto-friendly, with the Digital Asset Business Act (DABA) signalling the seriousness of the nation’s intent. Passed in 2018 and amended in October of this year to expand the licensing regime for digital

CHOOSING BETWEEN COINS AND CREDIT For advocates of increased crypto use in the Caribbean, greater adoption is overdue. But, for all the colourful headlines about cryptocurrencies and their potential, it is cash transactions that, by and large, are the mainstay of commerce here.

Gradualism with modernising payments – let alone adopting digital currency – is not something exclusive to the Caribbean. While Tokyo is famous for being the glittering capital of Japan, and a city that leans heavily on its futuristic brand to attract business and tourism from abroad, it is also a metropolis that has retained a heavy reliance on small coins for many years after the advent of the credit card.

Across the Caribbean, the lack of accessibility and affordability to more payment gateways continues to be a hindrance on productivity and growth.

This applies to crypto, credit cards, SBW and other payment gateways.

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DISRUPTORS

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GABRIEL ABED: “Bitt was built on rawness, doubt and uncertainty.”

Continued from page 1

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018 saw Overstock’s Medici Ventures invest US$ 3mn in Bitt, following an earlier capital injection in 2016 of US$ 4mn.

Then this year brought news of Bitt’s partnership with the Eastern Caribbean Central Bank (ECCB) in developing a blockchain-based digital currency.

Abed is renowned throughout the Caribbean for his impassioned and candid approach to business. STAR Businessweek correspondent Ed Kennedy spoke with Abed about his journey with Bitt, what he feels Caribbean governments should concentrate on in order to encourage business, and his future plans.

STAR: What were the advantages and challenges of starting Bitt in Barbados?

Abed: Well, to be blunt, starting Bitt in my native nation wasn’t an advantage at the time; it was almost the opposite, but I did have the right attitude and passion.

So, even though there was really so little in the way of suitable technology and support then, I knew that if I was going to build a business like Bitt, it had to be in Barbados.

I know others were saying: “Oh, you can’t do a business like this in Barbados,” that it’d be safer to start it in Canada or Mexico and so on, but I felt it had to be here. And I still feel it has to be here.

My employees are all from here or have relocated to here. I know in some ways it’s passion beyond reason, but it was about Barbadian pride, and pride in being from the Caribbean.

In the early days I was often ignored at conferences because I was from the Caribbean. That bugged me and I wanted to prove things could be different. That’s why I never listened when I was told we couldn’t, or wouldn’t, get it done building this business – and here we are today!

STAR: What do you feel is the most concrete explanation of Bitt’s value?

Abed: Quite simply the current banking infrastructure isn’t inclusive or open.

There’s no democratic payment system that exists. Bitt created an easy-touse application that works with local monetary systems, helping the unbanked and underbanked members of our society gain access to a digital financial network for payments, and to send and receive funds domestically.

It’s just not right that people don’t have access to banking networks. They miss out on critical financial services. It’s horrible, it’s not right, and we have to do better. Bitt fills a void in the market and also serves people most in need. Once you have a smartphone and Bitt, you have access to control your own finances.

That’s the simplest way I can describe it.

STAR: For anyone seeking to follow in your footsteps, to what extent do you feel the landscape has changed and

Gabriel Abed (left), founder of BITT. Inc and the founder of Digital Asset Fund signing an agreement with Premier and Minister of Finance, the Hon. David Burt of Bermuda in 2018. The agreement resulted in Mr Abed becoming a digital currency advisor to the island of Bermuda.

what expertise is essential to building a successful business in the space?

Abed: I’d just simply say to anyone starting today: “Build it and they will come.” There wasn’t much beauty in Bitt’s early days. There was rawness, doubt and uncertainty; and it was rough! Every day posed significant challenges and, to be candid, we still have to overcome obstacles, even today. I didn’t have a background in finance and, despite these difficulties and challenges, I’m now disrupting financial markets! So I say: “Don’t think. Do it! Just get it done.” Failure isn’t a bad thing; it becomes a lesson.

Bit Edge Technologies, in and of itself, was not a resounding success. I’ve tried five to six businesses before Bitt which were unsuccessful. I know some may argue whether it was my fault or actually just market conditions but, to my mind, I failed them. But I also succeeded with Bitt. I think both failure and success is a common part of every entrepreneur’s story, and you learn from both. So I say: “Never delay that learning.”

STAR: What’s the greatest liability you see right now for the world of cryptocurrency and blockchain going forward?

Abed: One of our biggest liabilities is the lack of education, and allowing myths and innuendo to win the day. This is a tragedy as the positives are huge. We have never had an immutable data system before; we have that now. This is just one example of many where considerable positive change is right around the corner. This means solutions now exist that, in the past, were never possible.

We need to do a better job of calling out claims that are simply untrue.

Another huge liability is the lack of real understanding and subject expertise among legislators and regulators who think we’re only out to cause havoc. It’s the opposite.

These technologies offer a solution that can save us from many currently growing problems we have with centralisation.

But it takes courage and clear eyes to get the solution in place and you can only work towards a solution when you have a real understanding of how to get there.

So I’d want to see more decision-makers have an open mind and build their deeper understanding of the field.

centralisation of society and the statebased sources – to find direct democracy.

I want to drive forward on that one day.

So, I want to optimise governance but remove the politician from it; to return greater “power to the people”. Right now though, that’s a long way down the line, but making systems more fair and efficient is something I’ll always be interested in within the private and public sector.

STAR: Aside from your current work, what other areas of the financial infrastructure are you eyeing?

Abed: Well, I think the next focus for me is stock exchanges and security exchanges in the short term. In the long term, I’d like to drive a rethink in the governance process; to disrupt hierarchical humans.

The frailty of man is flawed in the highest centralisation. We have to find a way to remove the flaws of people from the

STAR: By its nature, cryptocurrency can be borderless. What extent do you feel there’s potential for the Caribbean to develop its own identity as a hub for cryptocurrency?

Abed: I think it boils down to government. Regional governments need to provide the support. Potential compared to outcomes can be very different – one needs to only look at the experiences of Liechtenstein, Malta, Bermuda, Mauritius.

There’s no ‘one size fits all’ approach to cryptocurrency but there are common factors among nations that see it thrive.

Governments must be proactive, listen to the market and provide the climate for disruption to thrive; to embrace local and international entrepreneurs. The problem is, many of our governments are so overwhelmed with their daily concerns and underfunded while managing difficult economies. They aren’t really thinking about the future but instead are thinking only about the issues of today. I totally understand this, but ultimately they must understand we need them to create an environment to facilitate innovation.

Innovation in this space can deliver immense benefits, not only to business and entrepreneurs, but to everyone across all aspects of society. Best of all, if you implement it today, you can begin to see results rapidly that can help fix some of today’s most pressing problems. That’s the power of crypto and blockchain.

Quite simply the current banking infrastructure isn’t inclusive or open. There’s no democratic payment system that exists.

Bitt created an easyto-use application that works with local monetary systems

EDUCATION

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BREAKING THE LANGUAGE BARRIER

BY CATHERINE MORRIS, STAR BUSINESSWEEK CORRESPONDENT

T

here are six official languages in the Caribbean including Creole, French, Spanish and Dutch. Add to this the ever-evolving variations of indigenous patois and you have a region with a rich linguistic tapestry, informed by its unique history and culture.

“Language, as the first tool for communication, is essential,” says Evelyne Gasse, Director of Alliance Française of Saint Lucia. “New worlds can be opened through languages and exchanges can be developed. The more exchanges you develop in a region, the more you create a sense of belonging and the pride of being Caribbean.”

And yet languages are often not prioritised in the classroom, depriving the next generation of Caribbean citizens the chance to better themselves and their communities. A new project is now seeking to address this knowledge gap and promote plurilingualism among 11 English-speaking countries in the region, including Saint Lucia.

ALLIANCE FRANÇAISE In April 2019 stakeholders came together to launch the Integrate French as a Language of Exchange (IFLE) CARICOM project. A partnership between various regional and international bodies, including the OECS Commission, Alliance Française of Saint Lucia and the French Embassy to the OECS and Barbados, the initiative aims to promote French across the region, from Jamaica to Suriname.

It seeks to do this by investing in teacher training, networking and facilitating greater business and cultural linkages between the English-speaking Caribbean and their French-speaking counterparts.

The EUR800,000 project is funded primarily by the French Ministry of Europe and Foreign Affairs and, by the time it concludes in December 2020, hopes to have reached 110 French teachers and 1,000 students, enabling the latter to pass the Diploma in French Language Studies.

“Bringing this kind of assistance to French teachers is very important for us because, without them, Francophone is just a word,” says Gasse who is one of the project leaders. “I always ask: ‘Which teacher do you remember and why?’ Most of the time, the answer is the teacher who was passionate and creative. But to be passionate and creative, you need to master your art and you need to feel that you belong to a group that shares the same concerns and goals. That’s what we want to create.”

But the project mandate is not purely academic. Gasse emphasises the need for practical instruction that will help children make the most of their linguistic skills as they build connections in the

you will see your own country in another way.”

The IFLE is on a tight timeline, with much to do before it meets its December deadline. One of the first priorities is gathering data on how French is taught in primary, secondary and higher schools through a pilot initiative being launched in Saint Lucia. Gasse says information on this is scarce, making it more difficult to assess current need. “We can observe that there is a problem with language in the Caribbean but there is a lack of more precise data. That’s why, for the French part, we have decided to make what we have called a ‘realistic map’ of French learning at school in the Englishspeaking Caribbean countries.”

Director of Alliance Française of Saint Lucia Evelyne Gasse (second from right) with the French Ambassador to Trinidad and Tobago Serge Lavroff (left) and Mayor of Port of Spain Joel Martinez (centre) at the launch of ‘Jour du Prof de Français’ (Photo courtesy Evelyne Gasse)

Director of Alliance Française of Saint Lucia Evelyne Gasse speaks at the ‘Jour du Prof de Français’ event in Trinidad in November (Photo courtesy Evelyne Gasse)

world. “Foreign language learning needs to be done with the purpose of speaking.

I come from the French Alps. I learned to ski very early and our instructors always told us that if we fell, it was because we were progressing. It’s the same thing with languages. When we learn a foreign language and we make the effort to practise, we do not make mistakes but errors, and these errors make us progress.

“The more you learn foreign languages when you are young, the easier it is, as your ear and your brain are without filter and without fear. If you learn foreign languages, you will open your eyes to different cultures and worlds, and then

The upsides of learning language go far beyond communication. Being able to speak another language has proven benefits for mental acuity – improving concentration, memory, the ability to multi-task, creativity and decision-making

INDIRECT BENEFITS The upsides of learning language go far beyond communication. Being able to speak another language has proven benefits for mental acuity – improving concentration, memory, the ability to multi-task, creativity and decisionmaking. By enhancing core cognitive skills, language learning also positively impacts other areas of study, making students more well-rounded and ready for the workforce.

It’s no wonder employers prize multilingual employees. Not only can they network with global clients, they also tend to have better inter-personal skills. Having this kind of competitive edge can help employees move up the ladder more quickly and fill more highpaying jobs.

And the benefits aren’t just limited to individuals. A greater number of multilingual speakers in society helps build cultural connections and profitable business links. One of the core components of the IFLE project centres on entrepreneurship, forging bridges between markets in the English-speaking and French-speaking territories. In early 2020 the group expects to recruit a Regional Co-ordinator for Cultural Exchanges, based in Saint Lucia, and organise a ‘familiarization trip’ with artists and cultural representatives to French-speaking islands.

IFLE may focus on French, but Gasse is keen to broaden the focus to other languages, saying: “Of course, as we are French, we promote French but, most of all, we are interested in plurilingualism.

This region has always known multilingualism, several languages are spoken here. It is now necessary to move to plurilingualism and to organise a language strategy that will help nationals exchange languages in a more fluid way.

This will help everybody to be more mobile in the Caribbean.

“I am convinced that the Caribbean has the opportunity to appear as a large and dynamic region of the world. Developing mobility is a necessity to gain this status.”

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GEOPOLITICS IN 2020 Continued from page 2

As America gears up for one of the most contentious elections in the country’s history, both parties will be heavily focused on the US electorate and Caribbean policy is expected to take a backseat

The Dubai Expo 2020 kicks off in October 2020, offering Caribbean countries valuable exposure to the MENA market

In November, a US-Taiwan business delegation visited Castries to explore private sector opportunities.

Trade and investment could benefit, but a second presidency for Trump will likely also deepen political divisions in the Caribbean. The backlash from his closed-door meetings with four Caribbean leaders in March 2019 was a powerful sign that not only are most Caribbean leaders reticent to work with the US President, they are also vocal about condemning those that will, such as Saint Lucia.

As America gears up for one of the most contentious elections in the country’s history, both parties will be heavily focused on the US electorate and Caribbean policy is expected to take a backseat. When the dust settles, however, the leader in the White House must acknowledge that the US needs the Caribbean and it is imperative that the relationship with its ‘third border’ must remain cordial and mutually beneficial.

BREXIT BATTLE It has been a tumultuous year for Britain

as the country lost and gained a prime minister, held countless talks with European leaders and inched forward with a Brexit agreement. Last week, Prime Minister Boris Johnson solidified his mandate when he won the General Election with a substantial majority, giving him the impetus he needs to close out the Brexit saga.

What does all this mean for the Caribbean? Despite dire predictions, not much. Britain has had plenty of time to prepare for an EU exit and, despite the headlines, has not entirely wasted that time in political in-fighting. The former European trading giant has been steadily renegotiating and redrafting its existing trade deals to try to lessen the impact on business when it eventually cuts loose from the continent. In March the UK signed a series of ‘Post-Brexit’ trade deals with Caribbean nations, including Saint Lucia, that essentially preserve the status quo.

In terms of tourism, the fluctuation of the British pound has led to a drop in visitor numbers from the UK. A finalised Brexit paves the way for more stability which

will steady the pound over the long term, leading to an uptick in visits and real estate investment.

Arguably those most affected by events overseas will be the British Caribbean diaspora. These immigrants will now find themselves more restricted in terms of European travel and less able to access European opportunities in employment, education and business.

Brexit will also give the UK more power over its immigration policies and this could potentially disrupt longstanding arrangements with its former colonies.

THE RISE OF MENA They may still be dominating the conversation but Western superpowers are on the wane and 2020 is set to be the year of emerging markets.

The Middle East and North Africa (MENA) region is becoming increasingly important for the Caribbean as it looks to diversify its foreign relationships, minimise its reliance on the US and move away from its tired role as a US-Chinese turf war. MENA investors have already expressed interest in new and lucrative

niches such as renewable energies and infrastructure.

Of prime importance will be the Dubai 2020 Expo which kicks off in October and runs until April 2021. The event is the first world fair in history to take place in the region and will welcome almost 200 countries. Organisers expect around 25 million visitors during the six-month event and many Caribbean nations, including Saint Lucia, will have a presence, hoping to introduce themselves to business partners, tourists and government stakeholders.

North Africa is also on the Caribbean’s radar. In November the Organisation of Eastern Caribbean States announced the appointment of Ian Queeley as OECS Ambassador-Designate to the Kingdom of Morocco amid moves to deepen links with the Kingdom. OECS Director General Dr Didacus Jules commented: “Morocco is a long-standing friend of the Caribbean and ours is a partnership built on a foundation of south-south co-operation, mutual interest, values and hopes for a better tomorrow in the face of many existential challenges such as climate change, nationalism and shifting global alliances.

“The appointment of AmbassadorDesignate Queeley is a defining moment in our quest to build upon the already strong bonds of co-operation with Morocco across the tourism, education and agricultural arenas.”

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