Grameen-Jameel Is Strengthening Microfinance in the Middle East

Alex Counts is president, CEO and founder of Grameen Foundation, and author of several books, including Small Loans, Big Dreams: How Nobel Prize Winner Muhammad Yunus and Microfinance are Changing the World.

Last week I had the pleasure of visiting the historic city of Istanbul for the first time, on the occasion of the first Grameen-Jameel (GJ) partners meeting, followed by a two-day meeting of GJ’s Board of Directors, on which I serve.  GJ is a joint venture launched five years ago between Grameen Foundation and the Jeddah-based Abdul Latif Jameel Group to advance microfinance and poverty reduction in the Middle East and North Africa (MENA), and now Turkey as well.  (Peter Bladin and Jim Greenberg are the other two Grameen Foundation representatives on the GJ Board, while Fady Jameel is one of the two Jameel Group appointees, in addition to chairman Zaher Al Munajjed.) The partners meeting was elevated by the presence of not just representatives of 13 of the 15 GJ’s partner microfinance institutions (MFIs), but by Grameen Bank founder and Nobel Laureate Professor Muhammad Yunus.  (The only MFIs that did not join were one from Egypt and one from Syria, the latter due to the inability to get a visa, because Turkey has closed its embassy there.)

Prof. Muhammad Yunus speaks to the crowd at the Grameen-Jameel partner meeting, held in Istanbul.

The first day of the meeting consisted of an excellent overview by its General Manager, Julia Assaad, of GJ’s accomplishments.  She announced that GJ had surpassed its goal of reaching 1 million poor families with microfinance through its partner MFIs to date, and had in fact crossed the 1.5-million mark in September.  Representatives of five of the partners – the Turkey Grameen Microcredit Program (TGMP)in Turkey, Enda Inter-Arabe in Tunisia, DBACD in Egypt, Tamweelcom in Jordan and FONDEP in Morocco – spoke about their journey of starting and growing their organizations, and how GJ was able to help them in critical ways.

One of the speakers was Prof. Aziz Akgul, founder of TGMP, the largest MFI in Turkey (with more than 80 branches serving more than 55,000 families) and a key GJ partner.  Also present was Maya, the second leading MFI in Turkey and the first established there. It is one of the world’s few MFIs that not only serves 100% female clients but also has an all-female staff serving them. But before these presentations, Prof. Yunus spoke.  He congratulated GJ and its partners on their accomplishments and detailed the track record of the Grameen family of companies, especially Grameen Bank, Grameen Shakti and some of the most successful social businesses.  There were many probing questions from the delegates, who clearly enjoyed hearing from Prof. Yunus. In the afternoon, I led a session related to lessons learned in crisis management, drawn from Grameen Foundation’s partners around the world, especially in India and Haiti.  This was followed by formal presentations about the recent experiences of the LEAD Foundation in Egypt and Al Amal Bank in Yemen, both of which have had to manage their operations despite civil unrest and revolution. After an open discussion period, Professor Yunus offered some concluding remarks.  He noted in particular how impressed he was by the courageous behavior of the staff of Al Amal Bank.  He warned that, based on the post-independence experience in Bangladesh, things in the “Arab Spring” countries are likely to get worse before they get better.  However, he said that new governments – regardless of ideology – ultimately figure out that they need microfinance to thrive in order to be successful, so he urged the MFIs to put aside their own political beliefs and be open to responding to overtures from whatever leadership emerges in countries now in transition. That evening, GJ hosted a dinner at which local business leaders joined the delegates at a restaurant on the Bosporus River, where attendees heard Prof. Yunus give yet another speech. He was introduced by GJ Chairman Zaher Al Munajjed, who publicly announced the achievement of 1.5 million families reached by Grameen-Jameel through its MFI partners. The next day, Prof. Yunus gave speeches at Okan and Sanbanci Universities.  At Okan University, he inaugurated the “Muhammad Yunus International Centre for Microfinance and Social Business.”  The event at Sanbanci University was hosted by Prof. Nakiye Advan Boyacigiller, the Dean of the School of Management, attended by the chairman of the university’s board of trustees and was arranged by Mr. Al Munajjed.  In between those speeches, Prof. Yunus returned to the closing luncheon of the partners meeting to give some words of inspiration. The second day was spent designing a road map for the partners and GJ to maximize their poverty-fighting efforts in a region in turmoil.  Muhammad Khaled – one of the most respected microfinance consultants in the Arab World, who established and ran an MFI in Palestine, and was the co founder of the Sanabel microfinance network in the MENA region – spoke to several of us about the accomplishments of GJ over the past five years.  While he said that reaching 1.5 million families was impressive, he thought that our impact went far beyond reaching this milestone. He noted that due to GJ’s efforts, banks in Egypt had begun lending to MFIs much more aggressively and, as a result of a new standard being set, more than $150 million in additional financing had become available to MFIs in Egypt alone.  (By way of comparison, GJ’s annual budget has always been less than $3 million.) He also emphasized the impact and influence of the Progress out of Poverty Index^® – the social performance management and accountability tool based on Grameen Bank’s “Ten Indicators of Poverty." GJ's work to promote its use, he said, has helped the PPI^® become the industry standard in the region and globally.

Attendees at the Grameen-Jameel partner meeting mingle during a coffee break.

In a separate conversation I learned that Enda Inter-Arabe, the leading MFI of Tunisia, took advantage of the change of government there to secure the census data needed to design a PPI for that country (the tool is country-specific), and I assured the people I was speaking with that we would start the process of designing it right away.  It is exciting to see another country where the leading MFI uses this leading tool, which was commissioned by Grameen Foundation, in collaboration with CGAP and the Ford Foundation, and now being deployed by Grameen-Jameel in the MENA region. After lunch, the delegates visited a branch of TGMP, the leading Turkish MFI.  In the evening, they dined at a traditional Turkish restaurant and, with the assistance of a three-piece band, sang and danced for hours.  The final sub-group returned to the hotel at 2:45 a.m.! The Arab World is an unstable place right now, but it is also full of promise and a degree of optimism for the long term that I have not sensed before.  (I have been traveling there several times a year since my first trip in January 2002.)  Grameen-Jameel – the Arab World’s first social business and Grameen Foundation’s first joint venture – is in a unique position to contribute to realizing this promise, especially after this historic meeting and the timely advice and inspiration of Prof. Yunus.