Nobel laureate Professor Muhammad Yunus shared his vision of social business development and explained what this model can bring to the development of Africa, during a May 31 discussion on social business at the 48th Annual Meetings of the African Development Bank (AfDB) in Marrakesh, Morocco.
During the High Level Seminar on “Social Business Development”, organized in the context of the AfDB’s Annual Meetings which concluded on Friday, the Nobel Peace laureate from Bangladesh encouraged Africans to develop this economic system on a non-profit basis with the sole aim of solving the population’s problems and improving their living conditions.
What is social business development? How has this economic model allowed the transformation of the life of several thousands of people in Bangladesh? How can Africa be inspired? Yunus, the creator of the social business movement, answered these questions.
“Social business development is neither charity nor philanthropy,” highlighted the professor of economics. “It is a system aimed at solving the day-to-day problems of the population, without any dividends.
“This does not mean that we will not generate benefits. We conduct business like any other enterprise. The difference is we invest in the society, which generates revenue to solve the targeted issues, quite specifically,” he explained. In other words, “we do business to solve the problems of the population and improve their lives.”
According to him, the money should not be an end in itself, but rather serve to transform people’s lives. “All the benefits we generate serve to improve their living conditions,” said Yunus. In fact, he has transformed the lives of thousands of people in his country of origin, Bangladesh, creating his own investment bank in 1976.
Grameen Bank currently employs nearly 25,000 people. “I was teaching economics at university, but I could no longer stand the poverty in my country. That is why I have launched this project, because banks would only lend money to rich people and never to poor people,” he added.
Grameen Bank prioritizes its loans to women who live in rural areas, because they were completely excluded from the banking and credit system. Now, thanks to this initiative, they can create their own enterprise.
According to Yunus, the Grameen Bank works like a traditional bank, but with very low interest rates.
Thanks to the success of his microcredit bank, Yunus has expanded his field of action, having created four clinics where the poor can be treated at a low cost. Several million people in Bangladesh have thus been able to undergo cataract surgery so they don’t lose their eyesight. A fifth clinic is now under construction.
Yunus’ institution has also been involved in reducing malnutrition in Bangladesh, by signing a partnership with the French group Danone, which produces yogurt with vitamin supplements for malnourished children, at accessible prices, namely in favour of the poor. Schools have also been created to improve the education level in the country, where the population is among the poorest in the world.
All of these actions have led Muhammad Yunus to become interested in Africa and encourage this type of initiative in the continent. For a few years, he has been active in several African countries where he has shared his experience and where he has developed projects targetting the most deprived populations.
Yunus says he is willing to help all of those who wish to get inspiration from his company. However, he says US $4 million must first be in place as initial funding, before embarking on any microcredit project. This amount constitutes the base capital of loans made available to local projects.
Social business development can allow Africa to develop and Yunus is certain of this. “Africa is the future of the world. It is a continent with a lot of resources, although these have not been fully exploited,” he stated.
According to him “we need to implement structures to liberate energy and develop creativity. Africa will become the granary of the world.” Consequently, “the AfDB has a very important role in the promotion of social business development in Africa. It can raise awareness of this concept throughout the continent,” he added.
“We do not always need to wait for the government to do things for us. Citizens can change their lives through their own initiatives,” he highlighted, estimating that “creativity is the heart of social business development, while charity stifles creativity and places the person who asks for help in a position of dependence.”
Deliberately optimistic, Yunus assures that “nowadays, everything is possible in Africa. Women are already very active, managing finances, working hard and having an influence on development. All the conditions have been met. Africa is ready to change. We just need to believe in it.”