Bangladesh’s Supreme Court has rejected Mohammad Yunus’ appeal to continue as head of the Grameen Bank. This is bad news for Yunus, certainly, but not the end. Yunus, a pioneer of microfinance and winner of the 2006 Nobel Prize, has been under pressure for months, with the Bangladeshi government first floating charges of financial impropriety (which were never proven) and then bringing a case to dismiss him on the grounds that he had violated Bangladeshi law by staying on past the mandatory retirement age; Yunus then filed a legal appeal. The controversy generated an international furor, with the U.S. and other countries pushing for a settlement. A senior official for the Bangladeshi government told me recently that the government refused to negotiate with Yunus unless he withdrew his legal appeal, but Yunus refused. That logic now seems shaky now, considering that talks will resume after the appeal has been rejected. VOA reports:
A top official of the Awami League Party, Abdul Jalil, is hopeful of a compromise. “They are discussing the matters. I think the solution will be there. It will be solved. There will be an understanding honoring both the sides,” he said.
Losing the legal appeal does, however, mean that Yunus will not be able to continue leading the bank while the controversy played out. That will complicate his efforts to establish an orderly transition to new leadership for Grameen’s 8.3 million borrowers. He had proposed appointing a managing committee with himself as chairman, an idea the government had rejected. His most effective tool now will be the strength of his reputation. The case has already become a diplomatic issue, with U.S. Assistant Secretary of State Robert Blake personally intervening on Yunus’ behalf. What Yunus really needs now is a strong show of support within Bangladesh. The government perceives him as a threat, a rival power center with a huge constituency among both the poor and the small educated elite. Dhaka can dismiss the objections of the U.S. as foreign interference. A strong backlash at home will be much harder to withstand.