Blessed are economists
(Filed: 14/10/2006)
Muhammad Yunus is no diplomat or politician; he is simply an economist. Yet as the Nobel Peace Prize committee recognised yesterday, he has done more to help the world than virtually anyone alive today.
Mr Yunus's insight was simple, and is worth quoting: "Charity is not the answer to poverty. It only helps poverty to continue." He realised that, even if the vast amount of Western aid reached its intended targets, it would merely create dependency and suppress initiative. His solution was to start at the bottom – to offer small loans, at commercial rates of interest, to those in his native Bangladesh with no collateral and no credit rating. It was, in essence, a gamble on the goodwill and industry of humanity.
That faith, we are pleased to report, has been amply vindicated. Mr Yunus's creation, the Grameen Bank, has handed out more than $5.7 billion since 1983, with repayment rates consistently in the 90 to 100 per cent range. It has helped more than six million people, 97 per cent of them women, become part of the global economy; it has inspired similar groups, in more than 40 countries, to offer loans to more than 90 million people. By trusting the people of the developing world, rather than dictating to them, Mr Yunus created the most effective way to reduce poverty.
So why does he deserve a Peace Prize? Because, like Norman Borlaug, the American agronomist who won the 1970 prize for improving agricultural yields in the developing world and saving a billion lives, he proved that prosperity and peace are bound together. It is no coincidence that Africa, the world's poorest continent, is also its most violent. This has too often been ignored by the Nobel committee, which prefers to dabble in politics. Last year it honoured Mohamed ElBaradei, head of the world's nuclear watchdog, as a reproof to George W. Bush; previous Nobels have gone to right-on campaigners, or politicians such as Yasser Arafat or Kim Dae Jung, whose peace deals unravelled while the ink on the citation was still wet. The work of Mr Yunus, by contrast, will magnify the happiness of mankind
http://www.telegraph.co.uk/opinion/m...ixopinion.html
(Filed: 14/10/2006)
Muhammad Yunus is no diplomat or politician; he is simply an economist. Yet as the Nobel Peace Prize committee recognised yesterday, he has done more to help the world than virtually anyone alive today.
Mr Yunus's insight was simple, and is worth quoting: "Charity is not the answer to poverty. It only helps poverty to continue." He realised that, even if the vast amount of Western aid reached its intended targets, it would merely create dependency and suppress initiative. His solution was to start at the bottom – to offer small loans, at commercial rates of interest, to those in his native Bangladesh with no collateral and no credit rating. It was, in essence, a gamble on the goodwill and industry of humanity.
That faith, we are pleased to report, has been amply vindicated. Mr Yunus's creation, the Grameen Bank, has handed out more than $5.7 billion since 1983, with repayment rates consistently in the 90 to 100 per cent range. It has helped more than six million people, 97 per cent of them women, become part of the global economy; it has inspired similar groups, in more than 40 countries, to offer loans to more than 90 million people. By trusting the people of the developing world, rather than dictating to them, Mr Yunus created the most effective way to reduce poverty.
So why does he deserve a Peace Prize? Because, like Norman Borlaug, the American agronomist who won the 1970 prize for improving agricultural yields in the developing world and saving a billion lives, he proved that prosperity and peace are bound together. It is no coincidence that Africa, the world's poorest continent, is also its most violent. This has too often been ignored by the Nobel committee, which prefers to dabble in politics. Last year it honoured Mohamed ElBaradei, head of the world's nuclear watchdog, as a reproof to George W. Bush; previous Nobels have gone to right-on campaigners, or politicians such as Yasser Arafat or Kim Dae Jung, whose peace deals unravelled while the ink on the citation was still wet. The work of Mr Yunus, by contrast, will magnify the happiness of mankind
http://www.telegraph.co.uk/opinion/m...ixopinion.html
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