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Published on January 13, 2008

Chiang Mai's Punnisa Chao-sangket, 28, recently spent 75 days in Bangladesh, where she closely observed the magic of Muhammad Yunus's Grameen Bank, the world-renowned micro-finance operation for the poor.

Yunus and the Grameen Bank were awarded the Nobel Peace Prize in 2006.

Punnisa, a student of the Fletcher School at Tufts Univer-sity, travelled to Bangladesh late last year in hopes of learning about the micro-credit operation.

"I went there with high expectations to learn about Yunus's micro-finance system, which is often portrayed as a silver bullet to get rid of poverty.

"When a friend left after a week, I extended my stay and got the impression that the Grameen Bank does work efficiently for Bangladeshis, but it's not a panacea for development problems, especially in the long run.

"Yes, Grameen Bank's micro-finance system allows women there to access loans to improve their traditional lifestyles depending on their demands. It did prove to be helpful, but the purposes are still quite basic such as for fattening cows or improving farm productivity," she said.

"It is Yunus's design to strengthen women's power in Bangla society. He and his supporters believe that females can manage finances better than males. The system is different from conventional banking.

"Instead of setting banking rules, Grameen uses the social network and relationships to compel borrowers to return most of the loans.

"However, the overall development issue is far more complicated and beyond just the financial dimension. In Bangladesh, there are also frequent natural disasters like big floods, which often turn successful communities into poor villages again after being hit.

"In addition, their definition of poverty is rather different from what we generally understand. For example, the United Nations definition is something like the poor are those who earn less than a certain standard level, who have no access to clean water, no toilet, and so on.

"In that context, Bangladesh is among the least developed. But in the eyes of many local people, they do not regard themselves as poor. One Bangladeshi told me that she always feels she is rich. This person has three meals a day and time and resources to organise an informal school for kids whose families can't afford formal schooling."

Punnisa said that to amuse themselves, she and her friend often turn to their iPods to listen to music, which is somewhat inconvenient due to the need to recharge the battery.

"So some villagers asked us to join their evening conversations talking about each other's lives and families. That's another form of happiness."

Her impression of Yunus?

"He's the leader type of guy and people always give him loud applause, and he is often booked by foreign media," she said.

For Thailand's own poverty and development issues, royally-sponsored projects were a good example, she said. "Before, I was hardly interested in these projects, even though many of them have been implemented around my hometown in Chiang Mai.

"Now, it could be said that these royally-sponsored schemes have similar elements to those of microeconomic development projects as they strengthen villagers' self-reliance.

"The Grameen-like micro-finance system is also being used here to a certain extent."

But Chiang Mai still has to get its routine together. The province needs more than micro-finance to deal with its many problems.

Kamol Sukin

The Nation