Pioneering Economist Wins Nobel Prize

Muhammad Yunus and the Grameen Bank today emerged as the surprise winners of the prestigious Nobel peace prize for their pioneering work in lending to the poor.

Mr Yunus, 66, from Bangladesh, started the Grameen Bank over 30 years ago, to provide small loans - micro-credit - for the poor. In announcing the award, the Norwegian Nobel committee said the prize - worth 10m Swedish kronor (£728,971) was going jointly to Mr Yunus and Grameen Bank for "their efforts to create economic and social development from below".

The committee said: "Muhammad Yunus has shown himself to be a leader who has managed to translate visions into practical action for the benefit of millions of people, not only in Bangladesh, but also in many other countries.

"Loans to poor people without any financial security had appeared to be an impossible idea." The Grameen Bank provides credit to "the poorest of the poor" in rural Bangladesh, without any collateral, according to its web site.

From modest beginnings, the Nobel committee said, Mr Yunus and the bank have "developed micro-credit into an ever more important instrument in the struggle against poverty. Grameen Bank has been a source of ideas and models for the many institutions in the field of micro-credit that have sprung up around the world."

Mr Yunus and the Grameen Bank beat much better known names to the award.

The favourite, in the eyes of many commentators, was the former Finnish president Martti Ahtisaari, who helped broker peace between the Indonesian government and rebels from the Gam movement in the province of Aceh last year. "Every single individual on earth has both the potential and the right to live a decent life," the Nobel committee said. "Across cultures and civilisations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development."