Peter Mann reviews the Microcredit Summit Campaign report.
by Peter Mann, WhyHunger
“The day hunger is eradicated from the earth, the world will see the greatest spiritual explosion humanity has ever seen. Humanity cannot imagine the joy that will burst into the world on the day of the great revolution.”
-Federico Garcia Lorca, Spanish poet and writer
Garcia Lorca’s quote introduces the good news in the Microcredit Summit Campaign’s 2009 Report that 100 million of the world’s poorest families received a microloan in 2007, touching an estimated half a billion family members. This is not the end of world hunger, but it is one tool among many needed to end global poverty, and it provides new evidence that the microcredit movement is one of the most effective social movements operating today.
I was present when the Microcredit Summit Campaign (MSC) was launched in Washington DC in 1997 with the quixotic dream of reaching 100 million poorest families, and I attended the New York City event in 2009 which announced that the dream had become a reality. Each successful microloan points to a potential transformation in the lives of the poor. Jorimon Khan of Bangladesh’s Grameen Bank took her first US$10 loan in 1980 and bought a rice husker to husk and sell rice to local vendors. Her family was able to eat three meals a day for the first time. 25 years later, after successive loans and successful microenterprise projects, the lives of her grandchildren have been transformed.
Ingrid Munro, founder of Jamii Bora in Kenya, gave loans to 50 beggars in the Mathari Valley slum in Nairobi in 1999. “By August 2008, Jamii Bora had grown to 200,000 members through loans to beggars, prostitutes, thieves, and others who would normally be excluded from microfinance.” Among Jamii Bora’s remarkable achievements is a groundbreaking health insurance program developed in partnership with mission hospitals in Kenya, as well as the building of Kaputei town, “a revolutionary new community of 2,000 homes, space for 3,000 businesses, and a new school.” Ingrid Munro spoke to us in New York of the extraordinary talents in every human being, including those marginalized in the world’s slums.
The 2009 MSC Report told us that microfinance is being rethought and re-imagined. It is shifting from being a product (financial services) to becoming a platform for developing a range of products and services, based on a high-quality relationship with the world’s poor.
The Global Financial Crisis
“Party in the penthouse, fire in the basement.”
-Balbir Mathur, Co-Founder, Trees for Life
Balbir Mathur of Trees for Life has described global poverty and inequality in the phrase: “Party in the Penthouse – Fire in the Basement.” A relatively small number of people possesses unimaginable wealth, while some three billion people, nearly half the planet, live on less than US$2 a day and nearly one billion live on less than US$1 a day. This is the crisis of global inequality to which is now added the global financial meltdown.
The global financial crisis, and the sharp rise and fluctuation in food and fuel prices, create a challenge to microfinance expansion. Microfinance leaders in Asia, Africa, and Latin America have described for the MSC the increasing cost and drying up of loan funds from commercial markets and international investors. In his remarks to the NYC meeting, Muhammad Yunus, Grameen founder and Nobel Peace Prize Laureate, saw the global economic recession as not only a crisis but also an opportunity to restructure the world economic system and make it more inclusive.
He explained that Grameen is not linked to the international financial system but to a local financial system that provides a financial cushion and builds self-reliance. Grameen is owned by its borrowers, not by its employees, making it inclusive rather than exclusive: Yunus argued that now is the time for the mainstream banking system to become inclusive also. Otherwise, the ongoing collapse of the economic system will bring with it increased poverty, unemployment and disease, failing healthcare, and a deepening impact of climate change.
A social business such as Grameen and other microfinance programs are not simply there to make money: they see people not as robots but as multidimensional human beings who can figure out how to make the economic system work for everyone. In his remarks to the NYC meeting, Yunus described two desires in human beings, one selfish and the other selfless. Our existing companies are profit-maximizing businesses. The selfless desire which recognizes the multi-dimensional nature of human beings, however, opens the door to social businesses that are set up not to achieve limited personal gain but to pursue specific social goals. Yunus urged leaders to take off the profit-maximizing business glasses and put on the social business glasses which can meet the minimum needs of all worldwide.
Microcredit, Food, and Hunger
The story of Jorimon Khan, above, shows the impact of microcredit on hunger: her family began to eat three meals a day. Growing vegetables all year round, eating plenty of them and selling the surplus is one of the Sixteen Decisions committed to by Grameen members. Grameen’s expanded family of companies includes fish pond and livestock breeding programs, and affordable, nutritious foods for the poor. Successful microenterprise initiatives in Bangladesh and elsewhere attack the poverty and powerlessness that are the root causes of hunger by enabling the world’s poorest people to possess the means of production and exchange. This is a step forward toward Garcia Lorca’s dream of eradicating hunger from the earth.
For more on the Microcredit Summit Campaign, see www.microcreditsummit.org and [email protected]. Director of the MSC President and Founder of RESULTS is Sam Daley-Harris. The Campaign is A Project of RESULTS Educational Fund. For more on Grameen, contact Alex Counts, President and CEO, Grameen Foundation, www.grameenfoundation.org. On Grameen Bank itself, see www.grameen-info.org.