NRU :: Browsing by Author "Kasekende, Louis"

Browsing by Author "Kasekende, Louis"

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Africa: Africa's Counter-Cyclical Policy Responses to the Crisis
(De Gruyter, 2010) Kasekende, Louis
Louis Kasekende is Chief Economist of the African Development Bank (ADB). As Chief Economist, he is the Bank’s spokesperson on socio-economic and development issues of importance for Africa. He supervises the Development Research Department, the Statistics Department and the African Development Institute. He holds a PhD in Econometrics and MA in Economics from University of Manchester, UK; as well as a BA Economics degree from Makerere University, Uganda. Prior to joining the ADB, Louis Kasekende was Deputy Governor, Bank of Uganda. He worked for 17 years in the Bank of Uganda in several capacities, including as Director of Research Department and Executive Director with responsibility for Research and Policy. From 2002 to 2004, he was Executive Director, representing 22 African countries, on the Executive Board of the World Bank, USA. He has also served as a lecturer in Economics in Makerere University, Uganda, where he also supervised MA dissertations in a wide range of areas. Zuzana Brixiova is principal research economist at the African Development Bank’s Development Research Department. Formerly senior economist at the IMF, she worked on developing and transition economies in Africa and Central Asia. During 2002-04 she was the IMF's resident representative in Belarus and Lithuania. Prior to joining the Bank, she worked as the head of the Estonia and the Czech Republic desk in the OECD's Economics Department, covering the impact of the global financial crisis on macroeconomic policies and structural issues. In 2007-08 she was a Fulbright scholar in Ethiopia where she also guided several M.A. theses in macroeconomics. She holds Ph.D. in Economics from the University of Minnesota. Léonce Ndikumana is Director of the Development Research Department at the African Development Bank. Formerly Associate Professor of economics at the University of Massachusetts, Amherst, and Chief of Macroeconomic Analysis at the United Nations Economic Commission for Africa (UNECA), Léonce Ndikumana has contributed to various areas of research and policy analysis with a focus on African countries. He is an active member of major research networks around the world including the African Finance and Economics Association (AFEA) of which he is a former President, the African Economic Research Consortium (AERC) where he serves as resource person, and others
Capital account liberalisation
(Willey, 2002) Kasekende, Louis
Following full liberalisation of the capital account in 1997, Uganda realised increasing private capital flows. However, this has posed enormous challenges and risks. Macroeconomic management has been complicated because of the limited range and potency of available instruments. Moreover, not only are the financial institutions exposed to more risk and hence need stronger regulation and supervision, but the private sector also needs to develop instruments to hedge and manage the increasing risks in an open economy. This article argues that policy-makers should strengthen regulations, reporting requirements and data collection systems, and design market-friendly instruments to facilitate more appropriate management of a liberalised economy, while reducing volatility.
Capital Inflows and Macroeconomic Policy in Sub-Saharan Africa
(Palgrave Macmillan, 1999) Kasekende, Louis; Kitabire, Damoni; Martin, Matthew
During the last three years, there has been an expanding literature on private capital inflows to developing countries. In 1992 and 1993, attention focused on the rise in such inflows, their causes and nature. Gradually, it moved to their potential macroeconomic impact and the policy implications. In 1994 and 1995, following events in Mexico, it has concentrated on the sustainability of the inflows, and the policy implications of potential reversal. Virtually all of the studies have focused on Latin America, though some authors have also examined East Asian experiences. Analysis of Eastern Europe is extremely rare (Calvo, Sahay and Vegh, 1995; Griffith-Jones, 1995), and that of Mrica is virtually non-existent (with the notable exception of the excellent study by Asea and Reinhart, 1995). Even the most comprehensive recent analysis and survey of the literature (Fernandez-Arias and Montiel, 1995) has concluded that there is only impressionistic evidence of private capital inflows to sub-Saharan Mrica, where 'capital inflows have not materialized'. Mrica has continued to be analysed from the point of view that most of its capital inflows causing 'Dutch Disease' effects are aid inflows (see, for example, Younger, 1992). The key areas examined in the literature have been the scale and composition of private capital inflows, their causes and sustainability, their effects on macroeconomic stability, and their responsiveness to policy measures.
Financing Small and Medium-Scale Enterprises (SMEs)
(Bank of Uganda research department, 2003) Kasekende, Louis
This paper investigates the economic rationale for intervention in support of Small and Medium Scale Enterprises (SMEs) on both theoretical and empirical grounds. It argues that the inherent weaknesses of SMEs in Uganda deny them access to financial services. It further argues that the justification for their support lies in market and institutional failures rather than any inherent economic benefits. Specifically, the reasons given for supporting SMEs are basically to increase their access to financial markets and other services; and to reduce policy induced bias against them. The Uganda government and other institutions have made significant strides to accelerate the development of markets for financial and non-financial services suited to SMEs by promoting innovation in products and delivery mechanism and by building institutional capacity. However, even with this support, the SMEs have to so more, themselves, to overcome some of the challenges they face.
Global Imbalances and the Implications for Africa
(The Hague, 2007) Kasekende, Louis
indicated by D’Arista and Griffith-Jones (2006), the United States has for most of the past twenty five years carried current account deficits. In large part, the deficit has been sustained by a gradual depreciation of the US dollar vis-à-vis other major currencies, high growth rates in other parts of the world, and a willingness of non- US residents to increase their holdings of US dollars. The phenomenon of large and growing current account deficits of the United States (amounting to $869.1 billion in 2006, or 6.5 percent of GDP) and the associated large positions that foreigners (especially emerging economies) are amassing in US securities have become a central feature of the global economy, particularly in recent years. It has predictably garnered much attention from the financial press, policymakers, practitioners and, of course, academics. The three chapters by Barry Eichengreen and Yung Chul Park (2006), Jane D’Arista and Stephany Griffith-Jones (2006) and Fan Gang (2006) in the previous volume1 present an excellent discussion of many of the key issues and the way forward. My comments highlight some key issues to stimulate further discussion and then dwell briefly on the neglected region in the discourse – Africa.
Impact of liberalization on key markets in sub-Saharan Africa
(Willey, 1999) Kasekende, Louis
During the 1970s, Uganda suffered from an economic crisis characterized by distortions in all sectors of the economy. The exchange rate, for example, was highly overvalued, inflation was in the double-digit range while interest rates were held constant for most of the period resulting into negative real interest rates. In 1981, the first attempt to re-establish stability in the economy was made when government signed a stand-by arrangement with the IMF. Relative stability was created. However, the programme with the IMF faced slippages and was finally abandoned in the early 1980s when the government found it difficult to live within programme targets. Benefits to the economy were eroded as economic ills reappeared. Inflation accelerated to triple digit levels for most of the mid-1980s, overvaluation of the exchange rate worsened, parallel markets thrived while smuggling and capital flight became rampant. In May 1987, the economic reform programme was restarted and over the past twelve years has been broadened and refined with a view to re-establishing both internal and external balance. Initially the reform programme focused on eliminating distortions in the macroeconomic framework. Over the years, the focus has shifted to promoting efficiency in markets and according the private sector a dominating role in economic activities. The study shows the liberalization of markets and the shift to market determined prices has had a significant role in the re-establishment of stability in the economy and in promoting sustainable growth. The study also reveals the need to increase public investment in infrastructure and developing human capacity to facilitate private investment. The challenge is to adequately finance higher public expenditure while maintaining macroeconomic stability. Copyright © 1999 John Wiley & Sons, Ltd.
Plenary session on financial services and economic development in Africa
(Oxford academic, 2007) Kasekende, Louis
Uganda started financial sector reforms in the early 1990s as part of the broader objective of a shift to market-determined prices and private sector led growth. It was hoped that liberalisation of interest rates combined with a reduction in the participation of government in ownership would promote efficiency in the allocation of resources and promote competition within the sector. The implementation of the initial reforms was slow as there was tension between the broad objective and a residual constituency in support of the role of the state in allocation of resources, facilitating outreach of services to the poor and rural areas, and in setting of prices, especially for interest rates. However, there were other issues of sequencing associated with the reform that were not fully appreciated at the start of the reform. In particular, Uganda opted for a parallel process of implementing reforms in both the commercial and central banking segments of the financial system. This presented a challenge in effective supervision and regulation of licensed institutions. This was further complicated by the transition from a shared role in regulating and licensing of financial institutions between the Ministry of Finance and the Central Bank. The experience of Uganda is quite rich and provides key lessons for a country embarking on a reform of the financial system. The reforms have in a large degree eliminated segmentation arising from distortions from government interference in the price setting mechanism. Significant progress has been recorded overtime on a number of financial indicators including reducing the risk of bank failure. However, the strengthening of a financial system alone does not necessarily provide an efficient and competitive financial system. Liberalisation needs to be complemented by a programme of strengthening the regulatory capacity and framework plus strengthening institutions that support financial reforms such as land registry, commercial courts and credit reference bureaux if the objective of a strong and efficient financial sector is to be achieved. Large margins on interest rates remain, and competition and provision of long-term lending have remained largely elusive. The sale of state-owned bank also presented challenges in its implementation, resulting in a costly and lengthy process. In spite of the challenges in implementation of the reforms, the sector is in a far stronger position when compared with the pre-reform period.
Post-crisis monetary policy frameworks in sub-Saharan Africa
(Willey, 2011) Kasekende, Louis
Most of the monetary policy frameworks which use a domestic anchor for monetary policy in sub-Saharan Africa (SSA) employ quantitative money targets. Although these frameworks proved useful in reducing inflation in SSA, they are not well suited to the discretionary fine tuning of monetary policy. Monetary policy frameworks should be reformed in the post-crisis period, especially in the ‘frontier markets’ of SSA, where the need for activist demand management will grow in line with economic development and the integration of domestic financial sectors into global markets. Reforms should include adopting a broader set of policy objectives in addition to inflation, replacing broad money as the intermediate target with a more sophisticated set of indicators and forecasts and reform of the operating target. In essence, central banks should introduce a form of inflation targeting lite. This should be complemented by measures to strengthen the transmission mechanism of monetary policy.
Testing for linear engel curves
(Elsevier Ltd, 1984) Kasekende, Louis
The demand system, NLES, proposed recently by Blundell and Ray (1982), is shown to aggregate consistently across households. It is then used to analyse time series expenditure data of Korea, Greece, Israel and Puerto Rico. The empirical results reject linear Engel curves for each country.
Uganda's experience with aid
(Oxford academic, 1999) Kasekende, Louis
This paper presents Uganda's experience with aid flows over the period 1970-96. It discusses the compilation of aid data and also reviews the chronological developments in aid flows to Uganda. Over this period, the sectoral distribution and type of aid is largely dictated by the government's economic programmes in place. The period 1962-71 largely reflects government borrowing for on-lending to agriculture and industry whereas the period 1979-85 shows a wider range of sector-specific programmes driven by the need to reconstruct and rehabilitate the economy. Although the need to reconstruct and rehabilitate the economy continued, support for policy reform began to take up an increasing proportion of aid over the period 1987-96. We also analyse the impact of aid on some major macroeconomic variables and find that investment and real exchange rate developments have been largely driven by official development aid flows. Although we find a similar relationship between aid and improved policy environment, the findings show that in the latter part, i.e., 1992-6, the continued policy reform was driven more by ownership of the programme than by aid. Indeed, in this latter period, the aid/GDP ratios declined. The major lesson drawn from this study is that ownership of a reform programme is more critical for its success, hence our conclusion that aid should be used for financing rather than buying reforms.
What role does financial inclusion play in the policy agenda for inclusive growth in sub-Saharan Africa?
(Springer, 2015) Kasekende, Louis
The economic growth and structural change currently taking place in sub-Saharan Africa relies on household enterprises to provide the main source of employment for the labour force. The financial sector will only contribute to inclusive growth if financial access can be extended to household enterprises. Promoting a more inclusive financial sector involves challenges for central banks in their role as regulators of the financial system.

Browsing by Author "Kasekende, Louis"

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