and financial innovations like mobile money financial services and agent banking constitute critical elements of expanding financial access. in addition, i would like to highlight to the crane bank management that being located at entebbe airport brings additional responsibility in the area of customer service standards and national image. for a new visitor to uganda, often this branch may just be the first port of interaction with our country the banking sector today is characterized by heightened competition and increased risks. this requires financial institutions to continuously innovate to keep pace with the evolving risks. i am happy to note that crane bank ( u ) ltd has steadily improved its service delivery and rolled out new products to meet the changing needs of the clientele. i urge crane bank ( u ) ltd. to design robust risk management processes and internal controls to mitigate increased risks. bis central bankers ’ speeches in addition to proximity of financial services, another key factor which drives growth in the lending business of banks and therefore, financial access in uganda is that of affordability of credit. bank of uganda has for the fifth time kept the central bank rate ( cbr ) unchanged at 12 present having contained the inflation momentum as reflected in the drop of the headline inflation to 3. 4 present in april from 4. 0 present in march 2013. a neutral monetary policy stance was maintained by the central bank in order to boost economic activity further. going forward, the core inflation rate is projected to stabilize around the 5 present medium term target. in view of this, let me take this opportunity to once again urge banks to align lending rates with the cbr and facilitate the stimulating effects that are intended from bou ’ s monetary policy stance to be channelled to the economy. with these remarks, i commend the board of directors and management of crane bank ltd. for their demonstrated commitment to serving the people of uganda and beyond. it is now my honour and pleasure to declare crane bank ltd entebbe airport branch officially open for banking business. thank you. bis central bankers ’ speeches

louis kasekende : modernising agriculture – a difficult challenge facing uganda remarks by dr louis kasekende, deputy governor of the bank of uganda, at the launch of the 2015 agricultural finance yearbook, kampala, 1 december 2015. * * * hon members of parliament, the executive director, economic policy research centre, the leadership team of the uganda agribusiness alliance representatives of giz and other development partners, representatives of ministries, departments and agencies of gou, all distinguished participants, good evening, let me begin by commending everyone who worked on the 2015 agricultural finance yearbook for their contributions to this project. before we launch the yearbook, i would like to comment on two of the issues addressed in it which i believe are especially pertinent for agricultural policy : first, the appropriate role of the budget and second, characteristics of the support needed by smallholder farmers. the modernisation of agriculture requires support from the government budget for the supply of public goods and services needed by farmers. however, budgetary resources are scarce and hence it is essential that they are allocated only to areas of expenditure which can generate the highest social rates of return. as is demonstrated in chapter 1. 4 of the yearbook, on fiscal issues, the provision of tax exemptions for agriculture and agricultural lending, of various kinds, has delivered few, if any, tangible benefits for farmers in this country. any benefits accruing from these tax exemptions were mostly captured by non - farm sectors, such as importers and banks, and not passed on to farmers. this finding is consistent with what is generally known about tax exemptions in countries all over the world ; they are rarely effective and very difficult to target accurately and they entail substantial losses of public revenues. the scope of some of these tax exemptions was curtailed in the 2014 / 15 budget, which is a step in the right direction. given these findings, the remaining tax exemptions should be abolished quickly so that public resources can be focussed on areas which can really deliver benefits for farmers. public expenditure can contribute to agricultural development, but to maximise the benefits from a highly constrained budget resource envelope, spending must be allocated efficiently. the priority for public spending on agriculture should be goods and services which clearly have the characteristics of public goods, in that they cannot be supplied by the market in an optimal manner. in addition, these goods should benefit the smallholder farmers who constitute the vast majority of farmers in uganda. examples of these goods