It has been a very exciting time to be in Bangladesh! Dr. Muhammad Yunus and the Grameen Bank were awarded the 2006 Nobel Peace Prize, "for their efforts to create economic and social development from below"http://nobelprize.org/nobel_prizes/peace/laureates/2006/ The wonderful news about Mr. Yunus and the Grameen Bank winning the Nobel Peace prize has been a source of much joy and pride for all Bangladeshis. The newspaper has been filled with advertisements congratulating Dr. Yunus on his achievement. There is a palpable sense of pride as Bangladeshis are recognized for something other than flooding, corruption, cyclones and poverty.

Upon hearing that Mr. Yunus and the Grameen Bank had won the Nobel Peace Prize, I was interested to find out some of the specifics of this banking system.

The Grameen Bank is a specific form of Microcredit. Microcredit is the extension of small loans to enterpreneurs too poor to qualify for traditional bank loans. The Grameen Bank was started over 30 years ago to provide small loans - micro-credit - for the poor. The primary tenents of Grameen Credit are the following:

a) It promotes credit as a human right.
b)Its mission is to help the poor families to help themselves to overcome poverty. It is targeted to the poor, particularly poor women.
c)Most distinctive feature of Grameencredit is that it is not based on any collateral, or legally enforceable contracts. It is based on "trust", not on legal procedures and system.
d)It is offered for creating self-employment for income-generating activities and housing for the poor, as opposed to consumption.

Grameencredit is based on the premise that the poor have skills which remain unutilised or under-utilised. It is definitely not the lack of skills which make poor people poor. Grameen believes that the poverty is not created by the poor, it is created by the institutions and policies which surround them. In order to eliminate poverty all we need to do is to make appropriate changes in the institutions and policies, and/or create new ones. Grameen believes that charity is not an answer to poverty. It only helps poverty to continue. It creates dependency and takes away individual's initiative to break through the wall of poverty. Unleashing of energy and creativity in each human being is the answer to poverty. (http://www.grameen-info.org/mcredit/)

What I found interesting was the connection that Dr. Yunus (and the Nobel Prize committee) made between peace and economics. The following is an excerpt from "The Daily Star", which is the primary English speaking newspaper in Bangladesh.

Asked if the prize is appropriate for peace, Dr Yunus said, "I was not astonished to get the Nobel prize in peace because economics and peace are interrelated--economics influences people's life.
"Hunger is one of the main reasons of anarchy. If poverty can be reduced from the society, peace will prevail on earth," he added.