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16 Mar, 9 tweets, 2 min read
3. Growth via Technology Investment

Central Bank Digital Currency (CBDC)

- CBDC is NOT cryptocurrency (which is decentralized in nature). CBDC is backed and issued by BOJ.

- It will be legal tender, similar to the existing paper bills & coins we use, but all digital.
- BOJ will issue CBDC to deposit-taking institutions (DTIs..i.e. banks, etc.) and authorized payment service providers (i.e. Billpay, BillExpress, etc.) similar to how they currently do it with paper currency.

- The most prominent way of transacting will be via mobile devices.
- Customers can top-up their account through authorised agents or smart ABMs.

- Customers can do business using CBDC phone-to-phone with merchants.

- CBDC, if it achieves widespread adoption, will drive financial inclusion. Many unbanked, will now have access to...
digital currency just like they do with phone credit and cash.

- CBDC will be piloted this year, with the pilot expected to end in December 2021, with a roll-out in early 2022.

- This could be HUGE! As an MSME, I will automatically have a way to digitally accept payment...
from more potential customers than before.

- As a tech firm, I can build financial services that sit on top of this CBDC infrastructure to enable Jamaicans to do things we couldn't previously do.

- Those innovations will likely introduce significant efficiencies...
and make life easier for consumers. It will also drive the costs down for a variety of financial services which will result in more economic activity which will lead to growth.
- This has the potential to unleash a wave of innovation all throughout society, and could be quite disruptive (in a good way).
Note that this thread is part of a larger thread about the #BudgetSpeech2021

So if you read this out of context, it may not make complete sense.
See the parent thread below.

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More from @marcgayle

Marc Gayle Profile picture
16 Mar
I am going to pull the curtain back on the design of #Budget2021. There are some strategic decisions made throughout and the budget tells us a story about GOJ’s thinking.

It’s interesting digging into the story so we can understand the mindset.

//MEGA Thread

#FinanceTwitterJa
This is a very important budget for the following reasons:

- GOJ revenues are expected to fall by $70B or ~12% in FY 20/21
- GOJ expenses increased by ~$24B due to COVID
- PIOJ expects GDP to fall by 12% this FY ending March 31.
- GOJ had to do more, with less in the current FY.
- Due to prudent decisions by the MoF, GOJ had deliberately set aside $90B to pay down debt. That was ultimately used to cushion the revenue fall off and increased expenses due to the crisis.
- Despite these prudent decisions that helped with the heavy lifting re: spending...
Read 23 tweets
Marc Gayle Profile picture
16 Mar
1. Creative Risk Reduction Measures

The 3 Principles to Build Personal Wealth Are:

1. Make Money
2. Save Money
- Emergency Savings - to handle everyday, relatively minor non-budgeted expenses (replacing tech devices, buying meds, replace a car part, etc.).

#FinanceTwitterJa
2. Save Money continued
- Insurance - protect your savings and investments from major non-budgeted expenses (car accidents, hospital visits, natural disasters, etc.)

3. Invest Money
For a country it's similar. They make money from tax revenue. Savings have to be intentionally set aside (see the $90B GOJ used last year), and insurance needs to be acquired to handle shocks (e.g. weather or commodity shocks).
Read 17 tweets
Marc Gayle Profile picture
16 Mar
2. Growth via Infrastructure Investment

There is wide economic research that suggests that infrastructure investments are one of the most high-impact fiscal policy decisions that can boost economic growth. See one such paper below.

epi.org/publication/th…
The general idea is two fold:

- Humans are needed to build infrastructure (e.g. roads). As humans build these roads, they earn money and they spend it in the rest of the economy. They buy lunch every day, they save some of it, they buy groceries, etc.
As they spend throughout the economy, others benefit (all of the stores/restaurants etc that they spend in). So not only are direct jobs created on the infrastructure project, but jobs are created/sustained throughout the economy as spending increases.
Read 12 tweets
Marc Gayle Profile picture
16 Mar
4. Employment Growth via MSME Growth

These initiative are close to my heart, because I run a SME and advise a number of entrepreneurs that do the same.

DBJ has a recently launched programme for qualifying MSMEs to get a $200,000 grant to be invested in a digital transition..
(which includes building out e-commerce functionality and digitizing internal processes and more), called the 'Go Digital' grant.

Under the SERVE Jamaica programme, GOJ is allocating $1B to the DBJ so that MSME's that qualify for the 'Go Digital' grant...
to also be eligible for up to $800,000 in 2% interest loans to be used to support the digital transition.

Under the SERVE Jamaica programme, $2B is allocated to seed two equity funds exclusively focused on providing equity financing to MSMEs.
Read 20 tweets
Marc Gayle Profile picture
15 Jan
MSMEs & SMEs that sell consumer packaged goods directly to their customer via e-commerce should include a margin in their delivery fee.

I.e. do NOT charge your customer whatever the bearer charges you. Charge more.

You aren’t greedy, but prudent.

//Thread

#FinanceTwitterJa
I am going to make a few assumptions here:

- You want to build an independent, growing, profitable business.
- You don’t have deep pockets.
- You don’t want to physically deliver yourself.
- You are doing your own fulfillment.
- You want to provide great customer svc.
I am not speaking to delivery only companies like QuickPlate, etc.

I am also not speaking to large companies that can subsidize cheap/free delivery with high margins on their products or with deep pockets.

With those out of the way, let’s dive in.
Read 20 tweets
Marc Gayle Profile picture
28 Dec 20
I am going to pull the curtain back a bit on some ‘inside baseball’ currently happening in our local financial markets around the Derrimon $DTL.ja APO.

This is ‘dot connecting’ on corporate maneuvering.

Read below, there is a lot going on.

//Mini-Thread

#FinanceTwitterJa
So let’s go back to the early days of 2013 when $DTL.ja initially went public.

The lead broker was Mayberry Investments at the time.

The listing was very successful and the offer closed within 3 minutes of opening.

jamaicaobserver.com/business/Overs…
Mayberry Jamaican Equities ( $MJE.ja) took a big position in $DTL.ja.

In fact, they are the second largest shareholder as of today.
Read 17 tweets

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