low and stable inflation rates have reduced uncertainty in the economy which has in turn led to an increase in the levels of private sector savings and investment generating sustained economic growth. the annual headline and underlying inflation rates have averaged 4. 4 and 4. 2 percent respectively over the last five years. private sector gross domestic savings ( gds ) increased from 9. 4 percent of gross domestic product ( gdp ) in 2000 / 1 to 16. 7 percent in 2004 / 5. private sector investment increased as well from 12. 8 percent of gdp in 2000 / 1 to 18 percent in 2004 / 5. • the external sector continued to flourish as a result of improved competitiveness and gains from liberalised current and capital accounts in the country. significant pressure on uganda ’ s external sector obligations were lifted by the debt relief under hipc and the multilateral debt relief initiative ( mdri ) programmes. the resource savings arising from these programmes have contributed in strengthening the country ’ s external reserves position and uganda ’ s fight against poverty as well as efforts towards attaining its millennium development goals ( mdgs ). the second generation reforms were designed to sustain the macroeconomic stability, strengthen financial sector development and enhance productivity and poverty eradication. the transition of uganda from the poverty reduction and growth facility ( prgf ) to the policy support instrument ( psi ) framework undoubtedly marks an important turning point in macroeconomic management in uganda. it is perhaps in the context of the transition from the prgf to the psi that the contributions of mr. peter allum to this country ought to be recognised and appreciated. mr allum has served well as a reliable and important link between our national institutions and the multilateral organisations, while at the same time helping to promote a commendable level of cooperation between the official teams of these institutions. one of his remarkable attributes has certainly been his keen interest in providing timely advice on critical monetary and economic policy issues in general, but more particularly in assisting bank of uganda with capacity building efforts. on behalf of the board, management and staff of the bank of uganda, i wish to express our sincere and heartfelt gratitude to you mr peter allum for the manner in which you have discharged your responsibilities during your tenure in uganda as the imf resident representative. we sincerely would like to wish you and your family every success in your future endeavours. thank you and may god bless you.

, workers and the unemployed, and academics and policy - makers alike to ask some fundamental questions – first, about the role and structure of the financial system and, more recently, about capitalism itself. from the supporters of the occupy wall street movement to the editors at the financial times, the market economy is under acute scrutiny. in my remarks today i want to address these concerns. i have three main messages. first, markets work better than anything else at delivering opportunity and prosperity. second, an efficient and resilient financial system is an essential enabler to growth and inclusion. but, third and critically, markets only work well within sound policy frameworks. all markets – and financial markets in particular – need clear rules, diligent oversight, and consistent enforcement of the rules. systemic crises are not the inescapable product of capitalism, and inequality is not the necessary by - product of growth. bis central bankers ’ speeches central banks play an important role in supporting well - functioning markets by promoting both price and financial stability. these are essential public goods that sustain growth and mitigate cycles and inequality. growth, cycles and inequality over the past quarter century, steady advances in transportation, communication, and information technologies, underpinned by the widespread adoption of market - based economic policies, have globalized and expanded economies everywhere, especially those of brazil, india and china. never in history has economic integration involved so many people, such a variety of goods, and so much capital. this has dramatically narrowed the gap between rich and poor countries, lifted hundreds of millions of people out of poverty and created the potential for hundreds of millions more to share in the benefits. the shrinking disparity between the united states and china is particularly striking. in 1990, gdp per capita in the united states was almost 30 times higher than in china ; by 2010, this ratio had fallen to just 6 times. however, at the same time as inequality between countries has been declining, the gap between rich and poor within many countries has increased ( chart 1 ). countries as diverse as china, denmark, germany, japan, new zealand, sweden, the united kingdom and the united states have all seen inequality rise, as measured by their gini coefficients. 1 again, to use the example of the united states and china, from the mid - 1980s to the late 2000s, the gini coefficient in the united states increased from 0. 33 to 0. 37, while inequality in china increased from 0. 29 to 0.