JOURNAL | BOOK REVIEWS By: Jim Mulroney
|Grameen in Kosovo: A Post-War Humanitarian Manoeuvre
By Hongyu Wang
(AuthorHouse, 2015, 108 pp)
Jim Mulroney. A version of this review first appeared in the Sunday Examiner in Hong Kong.
To state that microcredit is a human right is bold, but it is the conviction of Hongyu Wang, the Hong Kong-based author of this short but enlightening book about the impact that a little money coupled with the right expert advice can have on the lives of impoverished people, even within the context of war-torn Kosovo in the early 2000s. While this book is a technical read, it is not a difficult one for anyone who has an interest in microcredit or breaking the poverty cycle that has trapped around three-quarters of the global population.
But even the uninitiated or casual reader can turn the last page with at least the hope that the poor do not always have to be among us. Wang’s exposé justifies hope that with enough political will, creating a model of wealth sharing to give all people a decent life is not beyond the ability of the global economy.
Microcredit was not a new concept when Muhammad Yunus, destined to win the Nobel Peace Prize, institutionalized it within the Bangladeshi Central Bank in 1976 and at the internationally recognized Grameen Bank seven years later. By 1989, microcredit was truly an internationalized reality, eventually spreading its tentacles to 40 countries across the Americas, Asia Pacific, Europe, the Middle East and Africa. The concept was already well established in the developed world but known as credit unions. Yet while their business almost exclusively involved consumption, especially of white goods, Yunus believed that microcredit could work for those who had little or nothing – not to consume, but to produce.
The author, born in mainland China and educated in Macau, builds his thesis on the belief that humankind is simple, yet revolutionary: there is potential within each human being to eradicate the suffering caused by poverty. The Grameen Trust has provided support to more than 150 partners using the approach that Yunus championed of introducing sustainable credit programs into some of the world’s most desperate poverty-stricken regions. But successful microcredit programs are not built on ignorance, and Wang explains in detail the necessity and process of providing expert assessments of proposed projects, careful screening of candidates and the discipline required to monitor programs. He quotes figures showing an almost negligible default rate on repayment, with most outstanding loans attributable to death, sickness or natural disasters. Microcredit has succeeded where states have failed to provide adequate infrastructure for normal business and employment practices to thrive, but Wang demonstrates that even in the most hostile environment of a totally failed state such as postwar Kosovo, it can also succeed because it creates its own infrastructure and introduces its own discipline.
Tiny and politically fragile, Kosovo was decimated by two vicious years of ethnic cleansing in 1998 to 1999, robbing it of a huge percentage of its population, industry and social infrastructure. When a relief program run by the Italian government asked the Grameen Trust to go to Kosovo in 2000, it arrived amid a fragile “peace” that saw more damage inflicted than the war itself.
While the preponderance of unfamiliar acronyms that Wang uses in his book can be irritating for readers, he does give a brief enough overview of Kosovo’s prewar history. This is adequately credible enough to set the scene and sufficient to give an understanding of the problems that people were facing and with whom the microcredit gurus had to deal. “Some households only had women left; all the men were killed,” Wang quotes a Grameen Trust manager as saying.
A 2003 assessment showed positive results. The project had provided opportunities for women where none had existed and promoted opportunities for war victims. Most importantly, it showed incrementally increasing incomes and growth of entrepreneurial skills, while at the same time building strong communities and boosting the self-esteem of its members. It also put women in the center of decision-making processes, gave an impetus to employment and developed a culture of saving, especially among women. In addition, the project bred resilience to overcome natural disasters and in particular assisted people in dealing with the harsh, freezing winters in Kosovo. A year later, the project was able to move into a second phase where enterprises were able to cover their own costs and loans to successful projects could be increased to aid growth and expansion.
Eventually, the Grameen relief project grew to the extent that demand for microloans was beyond the capacity of lenders. This ultimately reflects the success of any such program, which ideally should lead to the growth of a full-blown banking system.
The author’s own background took him into the world of Habitat, a program that trades sweat for capital in providing low-cost housing. His experience with microfinance came out of a document study in Grameen’s head office in Dhaka and his book was originally an assessment report on the Kosovo project. Consequently, it does not go into the community aspect of peer-monitored discipline and cooperation among members that produces the cultural change essential to the success of microfinance. Perhaps that is another story.
However, Wang clearly demonstrates the possibility that encouraging human ingenuity and self-development can yield an economic return far greater than a small investment. Does he establish his claim that microfinance is a human right? He says so, as it concerns human dignity and equal opportunity. But ultimately, the reader must decide whether microfinance trumps those who believe that the majority of the world’s population is condemned to live in poverty.