WASHINGTON (AFP) - Declaring credit a human right, Nobel laureate Muhammad Yunus said on Monday that the successful micro-lending bank he launched in his native Bangladesh showed wiping out world poverty was a goal within reach.
Yunus said Grameen Bank's miniscule loans to the destitute have allowed people to launch their own small businesses and lift themselves out of poverty without any massive infusion of outside aid.
"Poverty is an artificial creation of a system. Poverty is not in the person," Yunus said in a speech in Washington.
The economics professor was awarded the Nobel Peace Prize last month jointly with Grameen Bank, which began with a loan of 27 dollars and now lends nearly a billion dollars a year to the poorest of the poor.
"Fifty-eight percent of Grameen borrowers have moved out of poverty, and every year, every month more and more people are getting out of poverty," Yunus told an audience at the National Press Club.
"If people can do business and get out of poverty, what happy news for the whole world," he said. "We can create a world completely free of poverty."
He said conventional financial institutions and services were closed to most of the world's population, depriving people of a means to help themselves.
"Credit should be accepted as a human right," Yunus said. "Human beings are very creative beings. All kinds of creativity and ingenuity is built into the person," he said. And micro-credits were about "unleashing that creativity."
Yunus set out to help the poor after famine struck Bangladesh in the 1970s, shaking his assumptions about economics.
"I started to dread my own lectures," Yunus wrote in his autobiography, "Banker to the Poor". "What good were all my complex theories when people were dying of starvation on the sidewalks and porches across from my lecture hall?"
After learning that 42 people in the nearby village of Jobra were locked in deep poverty for want of 27 dollars, Yunus eventually established a bank that lent small sums of money at modest interest rates without demanding collateral in return.
Now the bank has close to seven million borrowers and has expanded its services, including education and pension funds as well as loans, to street beggars.
Yunus said the bank's wide reach has helped reduce poverty in Bangladesh and that by 2015, the country would likely meet a United Nations goal of cutting poverty in half. According to a recent joint study by the World Bank and the Bangladeshi government, the proportion of poor fell to 40 percent from 49 percent in the past five years.
Yunus reiterated his recent criticism of the World Bank, saying it should focus projects more on empowering local communities instead of channeling aid through governments. But the World Bank says it is committed to micro-credit projects.
While the idea of micro-finance had received widespread attention previously, the Nobel prize has given Grameen Bank's work a whole new level of interest and publicity, Yunus said.
"I am amazed at what one recognition of that nature can transform everything overnight," said Yunus, who earned a doctorate in the United States.
He said he was especially pleased that the Nobel prize had linked the fight against poverty to peace efforts. "This is one message that kind of gets lost ... that poverty is a threat to peace," he said.
The Grameen Bank provides an example of what Yunus called a new category of "social business", a venture designed to address a social problem while generating no dividends but no losses either.
"The present narrow view of business has to be expanded. You can have two kinds of businesses, one is business to do good to people and the other is to make money."
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