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Muhammad Yunus deserves credit for empowering the poor

Muhammad Yunus: “unselfish world citizen”.

In 1998, Professor Muhammad Yunus was the inaugural recipient of Australia’s only international award for peace, the Sydney Peace Prize.

Almost nine years later, in December 2006, he received the Nobel Peace Prize. In Australia we often wonder why it took so many years for the wisdom of the Sydney jury to reach Oslo and the Nobel committee. And at this moment I wonder why he’s embroiled in controversy in his home country, Bangladesh.

Given Yunus’ inspired work for the poor via the mechanism of micro credit, he was an inspired choice for the Sydney jury and subsequently for the Nobel Prize. His 1998 Sydney Peace Prize Lecture tells the story of his promotion of micro credit – small loans from the Grameen Bank – to empower women to establish small businesses and take control of their lives. That lecture was entitled ‘Peace Is Freedom from Poverty’.

The Bangladeshi economist was moved not only by the plight of poor people but also by the mismatch between economic theory and the lives of a majority of the world’s people.

In our conversations in Sydney in the 1990s he told about his years of study for his doctorate in economics at Duke University in the United States.

“But when I returned home to Bangladesh and saw again the desperate poverty and reflected on the sophisticated theories in my economic text books, I felt ashamed that the theories had no application to people’s lives. The theories were irrelevant!”

Professor Yunus dealt with this economic mismatch by creating the Grameen bank for the poor, often referred to as the women’s bank. Well over 90% of loans have been awarded to women who have had no entitlement to seek help from traditional banks, even if they were able to avoid the their husbands’ hostility to the idea that women should have a place in society and be able to better themselves.

Professor Yunus is a self-effacing, humourous, unselfish world citizen.

Even the fame associated with being a Nobel Prize winner has not gone to his head. In Sydney in 2010 he was the same insightful, accessible, charming guy whom I first met twelve years earlier.

He pours out energy for the poor. He challenges affluent and comfortable individuals. His imagination inspires and he generates trust. He wants others to own and run with the Grameen philosophy and practice and in consequence, never wants to be perceived as some kind of messiah.

Professor Yunus’ political savvy is a main reason for his success in creating such a successful world wide development movement. His main critique of mainstream economics was that it ignored questions of political economy.

There’s a current irony in that observation. Professor Yunus and the Grameen bank are now embroiled in a controversy which raises more questions about politics than about economics.

The Central bank of Bangladesh has claimed that Professor Yunus engaged in corruption by transferring funds from one account to another to be used for purpose for which they were not originally given. Given the casuistry - and mystery - of all sorts of accounting and banking methods, I can’t comment on that but it is obvious that powerful people in Bangladesh don’t take kindly to successful people- the tall poppy syndrome - who might challenge them.

The politics of Bangladesh seems to be the issue, not the trustworthiness of Professor Yunus. For example, the Government party the Awami Leage supported the removal of Muhammad as Managing Director of the Grameen Bank but the opposition party the BNP does not support the move.

On March 2, Professor Yunus was dismissed as managing director but subsequently the press was told by the Chair of Grameen that the Bank ‘has been duly complying with all applicable laws and that … Nobel Laureate Professor Muhammad Yunus is accordingly continuing in office.’

It looks as though politics swamps economic yet again. More important, the Sydney Peace Prize jury’s judgment in 1998 – that Professor Yunus’ unselfish, inspired mission for the poor – was a unique contribution to peace with justice – has been confirmed.

That this altruistic creator of the Grameen Bank for the poor is immersed in controversy is more confirmation of Professor Yunus’s earlier observations that economics without awareness of politics is unrealistic.

May the Bangladesh crafted controversy end. May Muhammad Yunus be supported. May the abolition of poverty be pursued.

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