And such fears could reduce current private spending, thus rendering public deficit spending ineffective. A shift towards a more sustainable supply-side-oriented path of public finances became necessary. This was realized in the early 1980s.
Secondly, we will eventually introduce a capital charge for operational risk, based on one of the methodologies in the Basel II Accord. We require more a radical change to the minimum paid capital requirement for banks. The current statutory minimum of Shs 4 billion, which was set six years ago, is far too low.