Microcredit, Macro Issues

Walden Bello | October 14, 2006

The awarding of the Nobel Peace Prize to Muhammad Yunus, regarded as the father of microcredit [1], comes at a time when microcredit has become something like a religion to many of the powerful, rich and famous. Hillary Clinton regularly speaks about going to Bangladesh, Yunus's homeland, and being "inspired by the power of these loans to enable even the poorest of women to start businesses, lifting their families--and their communities--out of poverty."

Like the liberal Clinton, the neocon Paul Wolfowitz, now president of the World Bank, has also gotten religion, after a recent trip to the Indian state of Andhra Pradesh. With the fervor of the convert, he talks about the "transforming power" of microfinance: "I thought maybe this was just one successful project in one village, but then I went to the next village and it was the same story. That evening, I met with more than a hundred women leaders from self-help groups, and I realized this program was opening opportunities for poor women and their families in an entire state of 75 million people."

Is Mozambique a Success Story?

Just how much of an African success story is Mozambique?

I've spent the past few days travelling around the country, thinking about that question.

On the face of it, the country deserves all the praise it gets. The economy has grown at around eight per cent per annum for 15 years now.

I lived in Mozambique in the early 1990s, and I can see the sometimes dramatic differences between then and now.