'Banker to poor' wins Nobel Peace Prize

Bangladeshi economist Muhammad Yunus and the Grameen Bank he founded won the Nobel Peace Prize last night for grassroots efforts to lift millions out of poverty that earned him the nickname of "banker to the poor".

Yunus set up a new kind of bank in 1976 to give credit to the very poorest in his native country.

Bangladeshis hailed Yunus after the announcement. Hundreds of friends and admirers gathered at his Dhaka residence with flowers and garlands to greet the man who set up Grameen Bank in 1976 to lend to the very poorest in his native Bangladesh.

"Bangladesh is proud of Professor Yunus ... (he) has brought a magnificent honour to himself and his country," said Shaheedul Haque, a senior government official and writer.

In a country born in 1971 after a war of independence and with much of its history strewn with coups, some hoped the Nobel Peace Prize -- the first in any category for a Bangladeshi -- would help usher in a less troubled future.

"Yunus has achieved a long cherished and deserved laurel. Let us now wish our country may achieve peace and tranquillity," said Mahmudur Rahman, a professor of medicine.

News of the award is likely to give the country a much-needed boost and welcome distraction from never-ending strikes and political infighting ahead of elections next year.

The disaster-prone country is one of the world's most densely populated. Many of its 140 million people struggle to eke out a living -- just the sort of client Yunus' bank aims to help.

"We congratulate Muhammad Yunus for his achievement which will play a great role to uplift the image of the country," Prime Minister Begum Khaleda Zia said in a statement, a view shared by her rival and opposition leader Sheikh Hasina.

"It's a world recognition to Muhammad Yunus for his hard work towards removing poverty from the country. His achievement will help create a huge impact for socio-economic and democratic development in the country," Hasina said in statement from New York.

"Yunus' award has brought Bangladesh to a new focus internationally. He has established that poverty and peace cannot go together," said Kutubuddin Ahmed, a business leader and ex-president of the Dhaka Metropolitan Chamber of Commerce and Industry.

Some wondered whether Bangladesh's image abroad had delayed the award for Yunus.

"Nevertheless, we have made it. Yunus has the Nobel Peace award today. He works for peace through the survival of the poorest," Dhaka University student Abul Hasanat Shaheen said.

Other saw the peace prize as a means of spurring greater efforts to reduce poverty in Bangladesh.

"Professor Yunus has achieved a huge glory for himself and his nation. This is a great deal of happy news for all of us," said Qazi Kholiquzzaman Ahmed, president of the Bangladesh Economic Association.

"With this achievement, much more responsibilities have been bestowed upon him to alleviate poverty," he told Reuters.

Dhaka housewife Elina Mahmud was overjoyed.

"I was so happy to hear this great news that I could not speak for a few moments. He deserved this honour," she said.

Over the years, women have comprised the vast proportion of borrowers of the Grameen bank, enabling them to start up small businesses without collateral. The bank lends to 6.6 million people, 96 per cent of them women.

* On Thursday, Turkish writer Orhan Pamuk won the Nobel literature prize.

- REUTERS