Bangladeshi economist Muhammad Yunus and the Grameen Bank he founded won the 2006 Nobel Peace Prize on Friday for grassroots efforts to lift millions out of poverty that earned him the nickname ”banker to the poor”.
Yunus (66) set up a new kind of bank in 1976 to lend to the very poorest in his native Bangladesh, particularly women, enabling them to start up small businesses without collateral.
In doing so, he pioneered microcredit, a system copied in more than 100 nations from the United States to Uganda.
”It’s very happy news for me and also for the nation. But it has burdened us with further responsibility,” he told reporters at his home in the Bangladeshi capital, Dhaka.
”Now the war against poverty will be further intensified across the world. It will consolidate the struggle against poverty through microcredit in most of the countries.”
”There should be no poverty, anywhere.”
The secretive five-member Norwegian Nobel Committee said the elimination of poverty was a path to peace and democracy.
”Across cultures and civilisations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development,” it said in the award citation.
”Lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty. Microcredit is one such means. Development from below also serves to advance democracy and human rights,” the committee added.
Yunus and Grameen were surprise picks for the 10-million Swedish crown ($1,36-million) award from a field of 191 candidates. The prize will be handed out in Oslo on December 10.
”This is the last prize. That’s what’s so special about it … it’s the sky,” Yunus told Norwegian television.
Returning from a Fulbright scholarship in the United States, Yunus was shaken by the 1974 Bangladesh famine and headed out into the villages to see what he could do.
He discovered the region’s women were in severe debt to extortionate moneylenders. Yunus’s initial goal was simply to persuade a local bank manager to give villagers regular credit, which the banker said was impossible without a guarantee.
Yunus set out to prove him wrong and never looked back. Grameen — the word means ”village” or ”rural” in the Bangla language — has lent $5,72-billion since it began. Of this, $5,07-billion has been repaid, a recovery rate of 98,85%.
Self-sustaining
The bank, which has turned a profit in all but three years, lends to 6,6 million people, 96% of them women, and has not received donor money in eight years. It counts beggars among its members, giving them interest-free loans and life insurance.
Today the bank is owned by the rural poor it serves, with 94% owned by borrowers and the rest by the government.
”In Bangladesh, where nothing works and there’s no electricity,” Yunus once said, ”microcredit works like clockwork.”
Nobel Committee Chairman Ole Danbolt Mjoes told Reuters: ”This idea was generated in a mostly Muslim country and then fantastically spread to the wle world in a positive way.
He added: ”We want to send a signal to the whole world that the fight against poverty is one of the most important things we are doing.”
The UN aims to halve the share of the world’s population living in the deepest poverty, some 1-billion people, by 2015.
Yunus said he was looking forward to visiting Oslo to receive the prize. ”Definitely I’m going to come,” he said.
Former Australian Foreign Minister Gareth Evans, whose own International Crisis Group had been tipped as a possible winner this year, said Yunus was an ”outstanding choice”.
”It’s been a stunning way of generating income and really changing lives for so many people in the developing world,” Evans said of the Grameen Bank’s efforts.
”It’s one of those inspirational, groundbreaking innovations that only come along every now and again, and I think it’s highly appropriate and I congratulate him.” – Reuters