But we also recognise that statutory bank regulation and supervision by a public agency such as the Bank of Uganda cannot be expected, on its own, to guarantee the sound management of banks. Moreover, excessively heavy handed regulation, although it might protect depositors, can also stifle innovation and risk taking in banks, which would be detrimental to economic development.
We need to conduct policies so that many people can enjoy the positive effects of international trade and capital flows on growth and productivity gains, while minimizing their potential negative impacts. Second, we need to be forward-looking in preparing for policy responses to medium- to long-term challenges. For instance, under Japan's presidency this year, we will discuss policy responses to aging.