Honouring a visionary banker with a mission
Oct 29th, 2006
Bangladesh is not necessary the land of frequent natural disasters, abundant poverty and growing fundamentalism alone, but the fertile South Asian country could give birth to a genius like Professor Muhammad Yunus. The densely populated and politically disturbed state found no limits of joys, when their very own Prof Yunus was declared as the winner of Nobel Peace Prize for 2006 jointly with his brainchild Grameen Bank of Bangladesh.
The news that the economist turned banker Prof Yunus and his mission Grameen bank were selected for the Nobel award came as a pleasant surprise for the Grameen family and its admirers around the globe. That the Nobel award goes to the most popular Bangladeshi banker did not make a surprise statement for most of his well-wishers, because his name was enrolled in the nomination of the coveted award for the last few years. But all the time, it was presumed that the former head of the economics department at Chittagong University would be selected for Nobel award in Economics. Surprisingly, the humble banker with a ‘mission possible to make the world poverty-free’ was declared as the winner of Nobel Peace award jointly with his bank.
International news agency from Oslo flashed on October 13 afternoon that the Nobel Peace Prize for 2006 was awarded to Dr Muhammad Yunus, the 66-year-old Bangladeshi behind the Grameen Movement with his non-conventional bank that has helped millions of poor  in Bangladesh.  The Nobel Committee categorically observed in the citation that ‘lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty’. The prize, worth 10 million kronor (1.37 million dollars) will be presented on December 10, the anniversary of Swedish industrialist Alfred Nobel’s death. Nobel’s will says that the prize should be awarded to ‘the person who shall have done the most or the best work for fraternity between the nations, for the abolition or reduction of standing armies and for the holding and promotion of peace’.
The Bangladeshi professor of Economics, Dr Yunus started Grameen bank project in 1976 as an experimental project. In 1983 it emerged as a formal bank. Till date, Grameen Bank has disbursed over 290,030 million Taka (1 US dollar = Taka 69) as loans to its 6.6 million borrowers. Today Grameen bank with more than 2200 branches nurtures around 6 million women borrowers covering 71,000 villages of the thickly inhabited (more than 120 million) country. With his micro lending schemes to the poorest of the poor women, Prof Yunus has authentically proved that poor women are most credit worthy.
The Grameen bank that believes and makes business on trust disburses small loans to the borrowers without asking for any collateral from them. While, the poor people are still not recognized as credit worthy by the usual banks in many parts of the globe, the Bangladeshi professor calmed that the poorest were the most bankable. The conventional bakers try to put argument that if loans are sanctioned to poor, they would simply eat it because of poverty. But the founder of Grameen bank maintained a different opinion, “The poorest of the poor will  repay the loan as early as possible, because they know it might be their last opportunity. Rather the rich will not pay back, because they know how to manage the situation.”
Even the borrowers of Grameen bank need not come to the office, but the bank officials go to the people and proposed for loans. The officials encourage the loan applicants to make groups, where the group members themselves decide how much and whom to offer the loan. The loans are repaid in weekly installments. Every week the borrowers get together for collecting installments and disbursing the loans in front of Grameen bank officials. There is total transparency in this exercise. Grameen Bank charges interest on the loan in the rate of 20% per year. Though the loans are disbursed without any collateral or mortgage, the recovery rate of Grameen remained unbelievably as high as 98%.
In the first phase, the borrower generally apply loan for paddy husking, bamboo works, puffed rice making, cane-works, mat making, fishing net making, weaving garment making, pottery productions, earthen ware container making, clock repairing etc. In the next stage, loans are provided for mobile phone, paddy cultivation, farming, land lease, tube wells, milk cow, poultry farm, bullock- buffalo rising, pond excavation etc.
Then loans are provided for some costly affairs like rickshaws, boat, baby taxi (auto rickshaw) purchasing and then for trading of various products like rice, cloth, fish, timber, chicken, wheat, medicine etc. and shop keeping for grocery and stationary articles, cloths, sweetmeat, shoe, magazine, musical instrument, fruit, tea etc. Lastly housing loans are also provided for the sincere and senior borrowers.
More amazingly 96 % of the Grameen borrowers are women. Prof Yunus considers that hunger and poverty are ‘more women’s issue than of male’ and hence his bank emphasizes more on the women borrowers. “Women experience hunger and poverty in much more intense way than men. If one of the family members has to starve, it is an unwritten law that it has to be the mother. Our experience teach us that poor women adapted quicker and better to the self helps process than men. They have the vision to see further and are willing to work harder to get out of poverty, because they suffer the most. Besides women pay more attention on her family, prepared their children to have better lives and are more consistent in their performance than men. When a mother starts making some income, her dreams invariably centre around her children but in case of man he starts paying attention to himself,” argues Prof Yunus.
Over the years, Grameen has gone from being just a bank to being a series of enterprises which include Grameen Phone for telephones and cellular phones, Grameen Uddyog which finances small scale enterprises, Grameen Housing which provides house loans, Grameen Shakti for electrifying rural homes, Grameen Agri Finances to purchase of modern farming implements etc. Prof Yunus dreams of taking cyber communication to rural areas and provide training to young rural women to get internet-savvy.
“We have now introduced many programmes in the bank- from student loans to pension funds and loans to purchase mobile phones to rural woman to loans to beggars to become door-to-door salesman,” revealed Prof Yunus. The banker with a mission ensures that the children of Grameen women must go to school and who have completed high school education should enter colleges or professional courses. Grameen fund takes care of these students such that their parent do not have to meet the additional economic burden. Prof Yunus is optimistic that once the students are well placed in lives, they will repay the loans and perhaps volunteer to finance the education of another batch of students.
The autobiography of Prof Yunus, ‘Banker to the poor’ is a straight reflection of his ideas about his mission that has received applause from the readers throughout the globe. The book, written in a simple and humorous language narrates Prof Yunus’s enormous struggles to establish himself as a baker with a mission from an university teacher with a background of a middle class family based in rural Bangladesh.
Prof. Yunus takes pride in saying that today the combined savings of Grameen bank’s borrowers is nearly Taka 14,000 million. If they wish, today they could buy the largest enterprises in Bangladesh. “My message is, do not ignore them because they are poor. Together they are rich,” asserted Prof Yunus.
On and often, Bangladesh receives international media headlines for wrong reasons like floods, famines and ever increasing Muslim fundamentalism. The country is also known for its political disturbance that causes human causalities frequently. Even the culturally rich country is frequently termed as a ‘failed state’ in different forums. However, Muhammad ‘Grameen’ Yunus has brought laurels to his countrymen. The achievement of Prof Yunus gives the Bangladeshis, living in home and abroad, a sense of great pride, which they needed desperately for quite a long time.
It was few months back, when this writer met the visionary banker at his office in Dhaka and wanted to know his feeling about the nomination to Nobel prize, the simple and straight answer came form the soft spoken unassuming gentleman that the award was always an inspiration that could help in strengthening the movement to eradicate poverty from the world as early as possible. Soon after he was declared as a Nobel winner, Prof Yunus declared, “Now the war against poverty will be further intensified across the world. It will consolidate the struggle against poverty through micro credit in most of the countries. There should be no poverty, anywhere.” The Ramon Magsaysay Awardee in 1984 argues that the ultimate place for poverty is the museum, because poverty has nothing to do within an enlightened society.
December 22nd, 2006 at 5:32 am
NOBEL-MAN’S UN-NOBLE CORPORATE NEXUS
by
Omar Tarek Chowdhury
Dr. Muhammad Yunus, the self-proclaimed ‘banker to the poor’, has been awarded Nobel Peace Prize 2006 and following the announcement of the award mainstream media created an euphoria throughout in Bangladesh. The mainstream academia has also jumped on the bandwagon. The unrestrained wave of delight created by the mainstream of society representing the ruling class in the wake of Yunus’ adornment with the coveted prize, has given it a ploy to camouflage its hollowness, intellectual shallowness and failure to govern the society it dominates. This ruling class is rotten to the core and morally and intellectually bankrupt. No wonder that in the era of neo-liberalism the opinion-makers and the dominant media, controlled by capital as they are, will be hyper-active to make people forget their woes and ‘feel good’. The award has provided a very good opportunity to them. The merriment-deluge washed away the sense of necessity that makes one analyze the significance of this world famous laurel which has been bestowed upon the founder-head of the Grameen Bank (GB).
Except a very few skeptics none will disagree that no other person has been adorned with so many awards and honorary degrees than Dr. Yunus, the teacher-turned-banker. The person advocating credit for the poor has so far won 68 awards, 28 honorary degrees and 15 felicitations from his motherland and other countries. Along with him the GB, his much acclaimed creation, has been awarded 8 national and international awards including Nobel Peace Prize 2006. These are, in a real sense, a recognition of his efforts to contain the poor in a way that helps to maintain the status quo and identify an effective alternative institutional method for profitable investment of finance capital. So, the mainstream policy-makers have come to recognize the merit of this method. The method devised by him has proved effective to all concerned ranging from the UN poverty-crusaders to the Citibank, from the promoters of technology-not-friendly-to-environment to the finance capital investors. These ground realities made it necessary for a wide range actors to construct a mythical image of Dr Yunus and in doing so there was an avalanche of awards, honors, etc., for him, an unending supply of chairs in the boards of ‘independent’ and ‘not for profit’ foundations floated and supported by multinational corporations (MNC). Reports with illusory images of his warm friendship with kings and queens and presidents and first ladies were circulated giving the impression of a fairy tale of friendship between a prince and a ‘pauper-son’. The target for these image-bombardments was the psycho-world of the common people. The corporate controlled pundits, media and opinion-makers have ‘illuminated’ the psycho-world of common people with illusions and high pitched propaganda to drain people of their reasoning, the power of questioning and the capacity of digging out truth. Sometimes the power-owners appear successful, at least for the time being. Relying on his magnified image Dr. Yunus has successfully become a broker in the world of international finance capital, in the marketing of technology and in the mainstream political economy. (It should be mentioned that brokering, lobbying, etc. are recognized and dignified professions in the western world.) Muhammad Yunus has been and is being awarded repeatedly for efficiently acting as a broker on behalf of big corporations of the west and as a chain reaction one award has attracted another.
No award is politics-,economics-,philosophy-, and ideology-neutral. While discussing an award it is worthwhile to take stock of the organizations or persons behind it, to whom it is awarded, and the reasons behind not awarding it to some other person than the one who has been tipped for it. Joseph Stalin was nominated for the Nobel Peace Prize but was not awarded it. Jean Paul Sartre, and in the near past, Arundhati Roy, the defiant voice, refused the Nobel Prize and Sahiyata Academy Award of India respectively. All these facts demand an analysis. Dr. Yunus was awarded the World Food Prize, known as the Alternative Nobel Prize, in 1994 and the prize is patronized by 74 organizations including the ‘famous’ US agri-business company Monsanto, Cargill and other US large soyabean and farm products exporting companies, the Agriculture Research Service of the US government, a number of financing companies and the ‘famous’ Coca-Cola. Yunus took initiative to float a joint venture company to market harmful agricultural technologies (genetically engineered seeds, Roundup herbicide, ‘transgenic’ or ‘genetically modified’ plant species) of Monsanto, a company despised in the west, in Bangladesh after being bestowed with the Alternative Nobel prize. Even US $150,000 was accepted by him to set up Grameen Monsanto Center for Environment-Friendly Technologies. This ‘pious’ act of brokering was initiated during the second micro credit summit. Monsanto in its zeal to send ‘poverty’ to a museum approached Dr. Yunus, would be curator of ‘poverty museum’, and he did not hesitate to collaborate. An adventure indeed! But he was later compelled to make a retreat with ‘dignity’ following a flurry of criticisms from different parts of the world by the environmentalists. However, the former university teacher offered no explanation to the members of the public, not even to his constituency — the poor in Bangladesh. Probably highly innovative minds need not engage in ‘petty’ acts like offering public apology for making profit at the expense of the environment and food security of the country. Nor do the poor have the opportunity to map the minds that win friendship of MNCs and kings and queens. But a number of personalities and organizations should be acclaimed for compelling the Nobel-man retreat and they include Vandana Shiva, the philosopher and environment activist; late AZM Obaidullah, a famous Bangali poet; and Nayakrishi Andolon, a movement for ecology-friendly agriculture in Bangladesh. The now-futile venture of the microcredit evangelist is a stark example of harming the agriculture of his motherland, endangering food security, creating dependency, and all these mighty tasks were planned to be initiated by offering ‘free’ technology through microcredit, the ‘panacea’ for the poor. The myth of ‘telephone ladies’ has been created with the same tact. These ’simple’ acts tell the intimate tales of the friendship between the poor’s banker and the mighty rulers, and help to explain reasons why the corporate owned media and the pundits, who are ideologically linked, are untiringly singing the same mantra, propaganda and gospel to build up the cult of the banker for the humble. An in-depth enquiry will show that many of the individuals and organizations engaged in this campaign are connected to each other through business and financial concerns. The link here is, also, finance and business. Just as the World Food Prize was related to the marketing of Monsanto-technology among the farmers of Bangladesh, the One World Broadcasting Trust Media Award (1988) and the World Technology Network Award (2003) from Britain, the Telecinco Award (2004) from Spain, connected to marketing of mobile phone, the Economist Innovation Award (2004) and the Leadership in Social Entrepreneurship Award (2004) from the US and many other awards were meant to expand corporate business interest. The German telephone giant Deutsh Telecom and the US software giant Microsoft are the patrons of the Petersberg Prize which was awarded to the Grameen Bank in 2004.
Dr. Yunus has received the Seoul Peace Prize from Korea a few days after he had been awarded the Nobel Peace Prize. Before he left for Seoul and after his return from there he did not forget to advice the caretaker government, mainly responsible to organize national election during its 90 days tenure, to take a quick decision on opening the Korean Export Processing Zone (EPZ) in Bangladesh.
It seems that formal functioning of the Korean EPZ is the top priority of the friend of the poor as MNCs have unrestrained liberty to plunder the natural resources of the country under the guise of foreign investment, as corruption, kick backs and absence of transparency is the norm in these deals, and as many people in this country about half-a dozen poor villagers shed their lives to safeguard the rights of people on the Fulbari coal mine in the northern Bangladesh; as the people of the country do not know the consequences of the agreements with companies like Asia Energy, which was awarded with the Fulbari coal mine on terms highly unfavorable to Bangladesh. It is interesting to note that though there are awards for those who can help the MNCs to maximize profit, there is none for advocacy work to create pressure and realize compensation for the irreparable loss of natural resources due to MNC operation. For example, there has been no award for anyone protesting against the damage done to gas and to bio-diversity by MNCs in the Magurchhara and the Tengratila gas fields, in north-eastern Bangladesh, which blew out due to their callous handling of the well-digging work. There has been no prize for advocacy work to safeguard people’s rights and environment in the Fulbari coal mine and its surrounding areas, there is no patron to support lobbying work in Washington D.C. in favor of the female workers in the garments factories who need safer working condition so that no worker has to be killed in fire accidents in the factories.
It is known to all that huge amounts of fund necessary for education and research in the universities in the west are often provided through grants, assistance, investments, etc. by many Foundations and Endowments set up by MNCs. Such donations obviously influence the activities of these universities. These financial supports influence, directly and indirectly, the ideology of the faculties, the boards of directors, the boards of regents, etc.; the decision-making process; curricula; and areas and subjects of research in the universities. The MNCs efficiently manipulate these bodies and process to advance their own interest. Awarding honorary degrees is an old tactic to build up someone’s image or to polish someone’s palm. There are precedents of awarding honorary degrees to despised and despotic rulers from different countries. Compared to those instances awarding Dr. Yunus scores of honorary degrees and awards seems to be ’small, innocent’ act. However, there is a need to remain awake to the ramifications of such awards and honors instead of naively looking at them the as the ‘recognition of a person’s extraordinary contribution’.
Muhammad Yunus was selected as one of the ”25 most influential businessmen in the world in the last 25 years.” Wharton School of Business made this selection in 2004 for a documentary made for the Public Broadcasting System (PBS), US. The rich and powerful tycoons in the list included Bill Gates, George Soros, Oprah Winfrey, Jeff Bezos, Richard Branson, Warren Buffertt, Michael Dell, Alan Greenspan, Lee Lacocca, Charles Schwab, Frederick Smith, and Sam Walton. The image of Dr. Yunus that has been built up gradually as a friend of the poor is, apparently, not in accordance with these rich people. Then, there comes the big question: what is the below-the-surface reason for his inclusion in this group of moneyed people? Is it a mere whim of a leading business school? But an analysis of the politico-economic factors brings forth a different answer: the efficient performance of Dr. Yunus as a new pathfinder for the investment of capital, as a broker and salesman of technology is the actual reason for his getting selected by the corporate circle as one of the 25 most influential businessperson in the last quarter century. The capacity of the Grameen Bank in this area is what has prompted the corporate circle to make its decision correctly.
A few more examples will help to show the close deals between Muhammad Yunus and the corporate world. He is a member of the advisory body of the Stockholm Challenge, the global network of the entrepreneurs of information and communication technology. The other members of the board include the senior vice-president of the chief research and science office of the San Microsystems, one of the leading computer companies; the president and CEO of Ericson; a member of the European parliament; a leading entrepreneur of Russia, Western Europe and the US. This list is enough for anyone to understand that safeguarding corporate interest, instead of pushing back poverty to a history museum is the main objective of this corporate network.
Dr. Yunus is co-president and a member of the advisory board of PlaNet Finance (PF), a French organization for financing microcredit programs. Sanofi-Aventis, a multinational pharmaceutical company, is one of the financing patrons of PF. Should anyone believe that Sanofi-Aventis and other multinationals are so eager to eliminate poverty from the face of the earth? One may pray that their eagerness should not be like that of Monsanto. If they are a bit less enthusiastic about poverty elimination that would a favor to the poor.
Dr. Yunus, as a member, adorns the advisory board of the Holcim Foundation, ‘independent of business interest’ established and run by one of the biggest cement and construction material producers in this poverty-ridden world. The Swiss company’s revenue in 2000 was US $ 8.2 billion. A look at the activities of the Rockfeller and Ford Foundations that have been criticized and condemned by many will help understand the reasons behind establishing such foundations and the type of activities they often carry out.
Apart from the close connections and deals with the MNCs Dr. Yunus has an organizational structure to turn microcredit into a vehicle for the investment of capital and marketing of technology producedby the MNCs. The Grameen Bank acts as a brand name or a franchise. Microcredit programs, broadly designed after the Grameen model are now being run in more than 100 countries, in continents east and west, in the north and the south. While Bill Clinton initiated it in the US state of Arkansas, the Reserve Bank of India, ‘inspired’ with the neo-liberal ideology, has liberalized their rules so that the program can be introduced among the starving tea farm workers in north-eastern India and among the poor in south India. It is a single string tying all: finance capital, the idle-capital seeking interest.
The Grameen Foundation USA (GFUSA) was established in 1997 to propagate and to expand the activities of interest seeking finance capital among the poor. Dr. Yunus is one of the founder-members and board members of this Foundation, a strategic partner of the GB. This Foundation has now spread out its credit net over 7 million breathing souls in 22 countries through 52 networks. This Foundation invests finance capital among the poor through its marketing of telephone, and through its window of microcredit which is financed by the capital market and commercial banks. It is closely connected with the Citibank, one of the largest financing organizations in the world. Along with Dr. Yunus, some former or present executives of Kane Property Company, GuideStar, Citibank, Microsoft, Citigroup, Calvert Funds and similar other large corporations and financing organizations are on the board of this Foundation. One can guess the power and brokering capacity of this Foundation from the fact that it is closely connected with the Clinton Global Initiative from the days of its inception. Former US president Clinton recommended Yunus for the Nobel award in 2005 for the second time though this move of Clinton went beyond all norms. Because Clinton was not empowered to make such a recommendation as Amartya Sen had been. While this act of recommendation was under way the GFUSA and Citibank joined hands as partner of the Clinton Initiative to jointly invest US $ 50 million and, if possible, $ 300 million, as microcredit. This Foundation has a special role in mobilizing capital, expanding GB-model micro credit all over the world, building up image of microcredit and its guru, and making public relations work. There is a similar type of power brokering house of Dr. Yunus in Australia to mobilize international power.
Undoubtedly, Dr. Yunus has become a blue-eyed boy of the corporate world for his excellent performance and innovations in the field of investment and marketing of finance capital and technology among the poor through microcredit. The third world is not a risk-free area for investment. The defaulting industrialists in Bangladesh are a stark example of this. There are other relevant questions that need to be addressed before an investment is made. The risk of socio-political upheavals in the country in question, the carrying capacity of the economy, the market size, etc. demand serious attention. Dr. Yunus has a ‘magic wand’ that creates an ensured market, an ensured return, an almost full return of the capital, an instant return, and all these he has done with his ‘panacea’ — microcredit. This is what makes him dear to the corporate world and the corporate world is paying him back with laurels, awards, honors, etc. and facilitating his job by building up a larger-than-life image of the salesman. Thus, the underfed, undernourished multitude is fed with the fairy tales of friendship between the ‘banker to the poor’ and the spellbound kings, queens, presidents and first ladies. The Nobel Peace Prize to Dr. Yunus has reaffirmed this fact only.
P.S.: Patrick Bond (Director, Centre for Civil Society (South Africa) and author of Looting Africa: The Economics of Exploitation) repored in the South African daily The Mercury (Oct. 25, 2006): ‘So why then did Norway’s Nobel committee give Yunus the award? Colleagues in Oslo point out to me that he was strongly supported by friends in the Norwegian elite, including a former top finance ministry bureaucrat and leading officials of the national phone company, Telenor, which owns 62% of lucrative GrameenPhone, a company in control of 60% of Bangladesh’s cellphone market.
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Note:
1. Websites: Grameen Bank, GFUSA, World Food Prize, Clinton Initiatives, Holcim Foundation, PlaNet Finance, Monsanto, GAIA Foundation, Stockholm Challange, Nobel Prize, natural-law
2. British agriculturalist Mark Griffiths’ letter to Dr. Muhammad Yunus, (June 29, 1998)
3. Vandana Shiva’s E-mail to Dr. Muhammad Yunus, (July 4, 1998)
4. Briefings of Rural Advancement Foundation International (RAFI), Canada and USA
5. BBC report on termination of Grameen-Monsanto deal. July 27, 1998
6. ‘Gene firm tightens grip on food chain’ by Louise Jury. The Independent (UK), 16.8.98
7. ‘Unmasking the microcredit success lie’ by Patrick Bond. The Mercury (SA), 25.10.06
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Omar Tarek Chowdhury (tarekomar@agnionline.com) translates pro-people political literature and contributes to alternative periodicals and newspapers.
January 4th, 2007 at 5:32 pm
Omar Tarek Chowdhury ia a paki and always jealous and try to harm Bangladesh.