than disable business. one such example is centenary bank which has successfully embedded its core religious foundation in its business model and yet maintained steady growth with a diversity of clientele and employees, irrespective of faith. ladies and gentlemen, ethics are crucial in the world of business. ethical business practises are essential if a business is to flourish in the long term and if the business sector is to command the support and confidence of the public. unfortunately, ethical standards in business often fall far short of what is desirable. this can be seen in the way in which businesses sometimes evade taxes and wilfully default on bank loans, contributions to the nssf or even paying salaries of employees. it is not uncommon for the owners and managers of businesses to divert business revenues or loans contracted by the business for their own personal use. to build a thriving market economy in uganda, dominated by private sector firms, major changes in the ethos and culture of business will therefore be necessary. unless businessmen and women conduct their business in an ethical manner, they will never build trust with their employees, their customers, their creditors and their suppliers. in the long term, trust is essential if businesses are to thrive, because a lack of trust raises the costs of transacting businesses and this makes it much harder for businesses to make profits. opportunities like securing funds through the capital markets cannot be optimised if we do not run our businesses ethically, with clear books of accounts and transparency. there are also opportunities in business partnerships to pool financial and human resources, and gain economies of scale ; to compete favourably for large scale projects. however these partnerships cannot be sustained without ethical practises and respect to contractual obligations. this event was termed as a networking dinner. networking in my view entails leveraging personal and professional contacts to grow the business through such avenues as securing a market for goods or products ; optimising each other ’ s knowledge and expertise including information on possible sources of funding or raw materials ; management competencies ; or access to skills. without a doubt, the church is best placed to teach us the key tenets of human relations such as accountability, self - respect and respect for others ; and taking into considerations the interest of others and not only our own as espoused in chapter 2 of philippians. i also think that the catholic church and its history teach businesses one critical thing – that is inculcating the vision, goals of the entity in each individual involved in the business or institution

closing remarks by prof. emmanuel tumusiime - mutebile, governor, bank of uganda launch of the eighth edition of the world bank ’ s uganda economic update : “ step by step – let ’ s solve the finance puzzle to accelerate growth and shared prosperity ” kampala, serena hotel february 7, 2017 ms. christina malmberg calvo, world bank country manager for uganda, members of the diplomatic corps, distinguished panelists, staff of the world bank in uganda, distinguished guests, ladies and gentlemen. i would like to begin by commending the world bank for publishing the eighth edition in the series of uganda economic updates, which over the last few years, have provided a valuable source of economic analysis for everyone with an interest in the ugandan economy. i would also like to thank the presenters, discussants and other contributors for all of the important insights they have given us this morning. given the main theme of this latest economic update, i would like to take this opportunity to offer my own perspective on the development of the financial sector in uganda, its role in the economy, and the challenges which it faces. page 2 of 8 to begin, i think that it is important to recognise the progress which the financial sector, and especially the banking sector, has made over the last decade. between the 2005 / 06 and 2015 / 16 fiscal years, commercial bank credit to the private sector expanded by more than threefold in real terms, at an average real rate of 12 percent per annum. although bank deposits also grew strongly over this period, by two and a half times in real terms, there was a marked rise in bank intermediation, with the ratio of bank loans to bank deposits rising from 53 percent to 70 percent. secondly, there has been a notable strengthening of competition in banking markets. the herfindahl hirschman index of market concentration in the banking market fell from 1, 508 in june 2006 to 909 in june 2016, denoting a substantial reduction in market concentration and an implicit rise in competition. the fact that competitive pressures have intensified in the banking market over the last 10 years is also reflected in a secular fall in the industry ’ s after tax returns on equity, from 32 percent in 2005 / 06 to 14 percent in 2015 / 16. page 3 of 8 it is no longer tenable to argue that banks in uganda make excessive profits. thirdly, although there have been occasional incidents of bank distress and failure over the last 10 years, prompt regulatory