Need to redesign the system to create wealth for all, says Bangladeshi economist

Professor Muhammad Yunus
Updated 14 March 2018
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Need to redesign the system to create wealth for all, says Bangladeshi economist

DUBAI: The microcredit model has proved that millions of women can become entrepreneurs without any training or education, according to Nobel laureate Professor Muhammad Yunus.
He also believes that the financial system needs to be redesigned to create a world that does not just benefit the rich.

Speaking to Arab News during his visit to Dubai recently, Professor Yunus said that the model of microcredit was to lend small amounts of money, about $20-$30, often to illiterate women in villages.

“These are women who never crossed the boundaries of their village. Yet they dare to take a $30 loan and become an entrepreneur,” Professor Yunus said.

The Bangladeshi economist hopes that young people will change the world. “They are not contaminated by the world’s way of doing things. They can start afresh as they have technology in their hands and can mold things their own way,” Professor Yunus said.

Professor Yunus talked about his most recent book, “A World of Three Zeroes,” which highlights the need for zero poverty, zero unemployment and zero net carbon emissions.

“The sum and substance of it is that the world is going in a wrong direction. The speed of that direction and its negative impact is getting higher and higher so we are sitting on a ticking bomb, which can explode at any time,” he said.

He said that a large chunk of the world's wealth was becoming concentrated in the hands of a few. “Today 1 percent of the world population owns 99 percent of the wealth, and tomorrow it will be worse,” he said.

This will lead to massive discontent and political and social disasters, he said. “I call it a huge mushroom of wealth which continues to grow but the ownership of the mushroom is by fewer and fewer people.”

Professor Yunus said that he sees selfless business as social business, which essentially means a non-dividend company to solve human problems.

“We created a lot of those businesses. Microcredit is one. We didn’t create it to make money for us but to solve the problems of other people. We needed to create counter banking, which is the microcredit that we did via Grameen Bank,” he said.

According to him, the bigger challenge is that the system is working against the poor. “So no matter what you do, you only do marginally better. You are not participating in filling the huge gap where wealth concentration has taken place,” he said.

“In order to do that, you have to redesign the machine itself. Microcredit is one piece of that machine, and not the whole machine. The entire machine has to be redesigned in a way in which wealth goes in both directions,” he said.

He said that the existing system had led to a perpetual model in which the condition of the poor may improve but at the same time the condition of the wealthy will zoom sky-high.


Oil prices rise on Libyan export interruption, but markets remain weak

Updated 11 December 2018
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Oil prices rise on Libyan export interruption, but markets remain weak

  • The rise came after crude prices dropped by 3 percent the session before amid ongoing weakness in global stock markets and concerns that slowing oil demand-growth could erode supply cuts
  • Crude futures have lost around a third of their value since early October amid the financial market slump and an emerging oil supply overhang

SINGAPORE: Oil prices edged up on Tuesday after Libya’s National Oil Company declared force majeure on exports from the El Sharara oilfield, which was seized at the weekend by a local militia group.
Despite that, overall sentiment on oil prices remained weak amid worries over global stock markets and doubts that planned supply cuts led by producer club OPEC will be enough to rein in oversupply.
International Brent crude oil futures were at $60.19 per barrel at 0336 GMT, up 19 cents, or 0.3 percent, from their last close.
US West Texas Intermediate (WTI) crude futures were at $51.16 per barrel, up 16 cents, or 0.3 percent.
Libya’s National Oil Company (NOC) late on Monday declared force majeure on exports from the El Sharara oilfield, the country’s biggest, which was seized at the weekend by a militia group.
NOC said the shutdown would result in a production loss of 315,000 barrels per day (bpd), and an additional loss of 73,000 bpd at the El Feel oilfield.
The rise came after crude prices dropped by 3 percent the session before amid ongoing weakness in global stock markets and concerns that slowing oil demand-growth could erode supply cuts announced last week by the Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC producers including Russia.
Crude futures have lost around a third of their value since early October amid the financial market slump and an emerging oil supply overhang.
In a show of no confidence, money managers cut their bullish wagers on crude to the lowest in more than two years in the week ending Dec. 4, the US Commodity Futures Trading Commission (CFTC) said on Monday.
The financial speculator group cut its combined futures and options position in New York and London by 25,619 contracts to 144,775 during the period. That is the lowest level since Sept. 20, 2016.
In physical markets, Kuwait and Iran this week both reduced their January crude oil supply prices to Asia
“There remains a lot of uncertainty if the production cut is thick enough to make a significant dent in global supply,” said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.
“The general risk-off tone in global markets and the stronger dollar ... are contributing to the selling pressure.”
The OPEC-led group of oil producers last Friday announced a supply cut of 1.2 million barrels per day (bpd) in crude oil supply from January, measured against October 2018 output levels.