The seizure of Grameen Bank

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by Richard Branson

August 24 2012

The Times of London

The sign of a truly great business is that it changes lives. There are few more noble examples than Muhammad Yunus’s Grameen Bank, which has helped to drag millions of Bangladeshis out of desperate poverty since 1979. Organisations such as Grameen, and pioneers such as Muhammad Yunus, should be cherished in today’s global economy where big business more than ever needs to be a force for good in the world.

Unfortunately, things are not looking good for Dr Yunus or Grameen, which makes tiny loans without collateral to the country’s poorest people. The Nobel prizewinner has been forced out of the bank because of unfair slanders against him, while the Government of Bangladesh is now close to gaining de facto control of an organisation that is 97 per cent owned by its customers.

I have witnessed first hand Dr Yunus’s contribution to the global movement to overcome poverty. The enthusiasm and energy that he brings in helping to spread the lessons of Grameen has proven invaluable in helping to find solutions to the great economic and social struggles of our age. It is work he continues to undertake to great effect — he is a terrific inspiration, particularly to young people all over the world.

The seizure of Grameen Bank is a tragedy. From its small beginnings in 1983, it now operates in more than 80,000 villages. Grameen has distributed more than $10 billion in loans to its borrowers, nearly all of whom are poor women. Now almost every country in the developing world has micro-credit institutions based on the Grameen model.

You would think an organisation that has made Bangladesh proud and transformed so many individuals, families and communities — and was itself awarded the Nobel Peace Prize in 2006, along with its founder — would be celebrated by its Government. Sadly, this does not seem to be the case in Bangladesh.

The Government has agreed in Cabinet a change that stands to break Grameen Bank and threatens the work it has achieved. The bank’s government-appointed chairman, instead of its millions of shareholders — the same people who are its borrowers — will now decide on Grameen’s new managing director and, with it, the future of the bank.

This prepares the ground for de facto nationalisation of Grameen Bank. Soon, it will no longer remain the same bank that it always has been. The rights of shareholders to decide its future will be removed. This will be a sad end of a globally admired institution.

The World Bank recently cancelled more than a billion dollars in financing after it pulled out of a project to build Bangladesh’s biggest bridge because of concerns about corruption. It is vital that everyone in the international community ensures that we hold the Bangladeshi Government accountable for providing a fair, transparent and safe environment for leaders such as Dr Yunus and others to work with the people of Bangladesh to ensure that they can live the lives of dignity they deserve.

Britain’s Government, currently Bangladesh’s single largest direct donor, has enormous influence that could be used to ensure that the Government is transparent and fair. In the past month the UK has demonstrated how it will not support others who have been seen to have flouted Britain’s belief in fair play and respect for human dignity. They have withheld aid from the Government of Rwanda over its alleged backing for rebels in Congo and barred the serial human rights abuser President Lukashenko of Belarus from attending the Olympic Games.

Britain can also choose not to accept the actions of the Bangladeshi Government over Grameen Bank and against other similar institutions.

The British Government needs to ensure that our £1 billion in direct aid to the current Government of Bangladesh over the next three years is used wisely to reduce poverty and bolster freedom of speech, not to control and destroy poverty-busting initiatives such as the Grameen Bank.

Dr Yunus has been urging his fellow citizens to come forward and protect the right of the poor women of Bangladesh to own Grameen Bank. The British Government should join him. These owners are being deprived of the right to chart the course of the bank in which they are shareholders. Grameen is their bank and they should decide who leads it. Taking away that right is a blow and a threat to the vibrant civil society that Dr Yunus and his colleagues have worked hard to create.

Grameen Bank is a vitally important institution. It carries the hopes, dreams and aspirations of millions of women and their families. It is not only Bangladeshis who need Grameen Bank. It keeps the flame of hope for all poor women around the world. None of us — the British as international funders, nor the people of Bangladesh — must let it disappear.

All of us as the international community need to break the silence and stand up for the wonderful work of Muhammad Yunus.

Richard Branson is the founder of the Virgin Group of Companies

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