A messiah for the poor
Dr. Muhammad Yunus recently turned down a nomination for President of the World Bank. But what does this messiah for the poor symbolize for the developing world?
Dr. Muhammad Yunus may be Bangladesh’s only hope
for a poverty-free tomorrow
On 22 February 2012, Bangladeshi Prime Minister, Sheikh Hasina requested the visiting member of the European Union Parliament, Jean Lambert to support the candidature of Nobel Laureate and legendary figure, Dr. Muhammad Yunus as President of the World Bank. The slot will fall vacant after the retirement of current President, Robert Zoellick on June 30 and a number of contenders have already entered the race to win the position.
Sheikh Hasina’s proposal to support Dr. Yunus for the World Bank’s top slot came as a surprise to many. According to the AFP report of April 5 2011, Dr. Yunus was forced to leave Grameen Bank, succumbing to opposition from the Prime Minister and the verdict of the Supreme Court that removed him from that position. Furthermore, his supporters argued that “he was victimized by the Prime Minister whom he crossed in 2007 when he set up a political party during the military-backed caretaker government. In December, 2010, following the release of a Norwegian TV documentary critical of Yunus, Hasina accused him of sucking blood from the poor and pulling a financial trick to avoid paying taxes.” The position taken by Dr. Yunus during the caretaker government was meant to provide an alternative to the Bangladeshi people as the two political parties, Awami League (AL) and Bangladesh Nationalist Party (BNP). He later withdrew his political agenda, which was apparently backed by the military establishment.
There are four major reasons to justify why Dr. Muhammad Yunus is an asset not only to Bangladesh but to South Asia and the developing world. The Beggars’ Program, which started with 1,000 beggars and is now reaching 100,000, helped mitigate the menace of begging in Bangladesh. According to the program, beggars were loaned $15 per borrower to sell goods for profit. Yunus’s innovation to allevi-
ate poverty through social business is considered a landmark and milestone in understanding the dynamics of social backwardness.
Social business illustrates a “cause driven business. In a social business, the investors or owners can gradually recoup the money invested, but cannot take any dividend beyond that point. No personal gain is desired by the investor. The impact of social business is on the people or environment, rather the amount of profit made in a given period.” It is because of his life-long dedication and commitment to improve the lives of the poor that led to the innovation of a “social business” concept (a fact, which is also recognized in the developed world), earning Yunus the title of “Messiah.”
Secondly, after receiving his PH.D in Economics in 1969 and returning to Bangladesh in 1974, Yunus launched micro-credit financing. An economist with a non-traditional approach, he joined the Department of Economics at Chittagong University. His vision of poverty alleviation clicked when in 1974 he conceived and presented the idea of Gram Sarker at the village level to reduce rural poverty. He opened the Grameen Bank, which transformed the face of rural Bangladesh, particularly the women. Presently, the Grameen Bank operates 1,092 branches in 36,000 villages of Bangladesh, providing credit to over two million poor people with a capital of approximately US$2 billion. The beneficiaries of Dr. Yunus’s vision of microcredit are the rural poor and primarily women. However, Yunus’s vision of poverty alleviation has faced heated criticism. As is common in many post-colonial states, people suspected his intentions to the extent that Sheikh Hasina and other politicians charged him of using Grameen bank and his micro-credit schemes for personal benefit. Despite all such allegations, Dr. Yunus’s image and reputation remains unblemished and untarnished.
Thirdly, the principled position taken by Dr. Yunus regarding his nomination as the President of World Bank is admirable. He outlined his reservations about the functioning of the Bank and questioned why a U.S citizen always leads it. Criticizing the Bank for doing little to ameliorate poverty, Yunus lamented that, “despite its slogan of working for a World Free of Poverty, the World Bank has consistently failed to provide program funding for micro credit.” He has requested the World Bank “to increase its funding of micro credit programs” so that effective steps are taken for the alleviation of global poverty. Dr. Yunus urged the international organization to increase investment in micro credit to 2 percent of program spending, of which 50 percent of the amount should be reserved for those living on less than a dollar a day. It is because of his reservations that Dr. Yunus refused to accept the nomination for the President of World Bank as according to him, “he has dedicated his life to social business.” He stated that, “I have been a regular critic of the World Bank for its policies and programs. My criticism also included the fact that this Bank’s highest post is always reserved for an American citizen. I never thought of taking up the job of the World Bank. The World Bank should be turned into a bank for the poor with the aim of ultimately diminishing poverty worldwide.”
Finally, as a celebrity and because of his life-long contribution to the poor, Dr. Muhammad Yunus is above the top slot of the World Bank. Yunus realized that the enormous clout pos- sessed by the Group of Seven in the functioning of World Bank will make him ineffective as the Bank’s President to take steps for the alleviation of poverty. Around 60% of the Bank’s holdings and capital belong to the G-7 countries with very little or no voice for the developing world in the policy matters of the Bank. Had Dr. Yunus been nominated and selected as the President of World Bank, his main priority, to improve the social and economic conditions of the rural poor, would not have matched with the priorities of a Western-centric bank.
In view of Dr. Yunus’s achievements to alleviate poverty, SAARC should seek his services and create a slot at the organizational level in the field of empowering the poor, particularly women. The UN Secretary General had appointed Dr. Yunus to the International Advisory Group for the Fourth World Conference on Women in Beijing from 1993-1995. He also served on the Global Commission of Women’s Health (1993-1995), the Advisory Council for Sustainable Economic Development (1993 to present) and the UN Expert Group on Women and Finance. Furthermore, he served as the chair of Policy Advisor Group of Consultative Group to Assist the Poorest.
Around 25 percent of the people of South Asia live below the poverty line or survive on under $1 a day. The innovative ideas of Dr. Yunus to target issues that deepen social backwardness and under-development leading to the disempowerment of the people can prove immensely useful for South Asia.