The International Monetary Fund (IMF)
The International Monetary Fund (IMF) was established in 1946, along with the World Bank. The IMF was developed to promote all monetary cooperation and remedy economic problems incurred during the post - war reconstruction period (Baylis; 2008: 245). The IMF was therefore considered as the “rule keeper” and an important component in public international management. In the pursuit to stabilise the exchange rate system, the IMF reserves the authority to change exchange rates. Another vital role is control over the balance of payments deficit of states and governing the policies which affect states monetary systems (Spero; 1990: 33). However, since the 1980 's, the IMF 's role has settled into the position of an institution providing assistance, based on financial situations, to developing countries. In order for countries to receive any assistance, the
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It is seen as the largest source of development assistance, along with the IMF, to developing countries. However, the World Bank requires the support of other organisations apart from the International Monetary Fund. These organisations include the International Development Association, the Multilateral Guarantee Agency and the International Finance Corporation (Baylis; 2008: 245). The role of the World Bank in our generation has not changed much compared to the past goals. The World Bank has assumed the responsibility to resolve the major challenges faced by poverty-stricken countries through capital provisions, assumed the role as a mediator for fragile countries in conflict and assisted with global development on a economic, social and reconstructive level. These goals form part of the overall Millennium Development Goals which were adopted by the World Bank
These international economic institutions should possess substantial transparency considering their policies directly affect the public. Instead, the IMF and similar institutions have no accountability to the public of which it is supposed to serve. Through lack of transparency, countries with major influence in the IMF such as the U.S. can indirectly impose its own investment agenda upon the country in crisis. If actions of the IMF were directed through a democratic process, more logical and productive policies would develop. If the IMF promotes transparency through the policies it imposes on developing countries, it should set an example through its own governance.
The theme of this essay outlines two things. One, the key elements of Bretton woods system and second, the characterisation of Bretton woods system by Ruggie as ‘embedded liberalism’, and how far he succeeds in it. The Bretton woods system is widely referred to the international monetary regime, which prevailed from the end of the World War 2 until the early 1970s. After the end of the World War 2, the need of international monetary framework to boost trade and economic; growth and stability, was important. Taking its name from the site of the 1944 conference, attended by all forty-four allied nations; the Bretton Woods system consisted of four key elements. First, to make a system in which each member nation has to fix or peg his currency exchange rate against the gold or U.S. dollar, as the key currency. Secondly, the free exchange of currencies between countries at the established and fixed exchange rate; plus or minus a one-percent margin. Thirdly, to create an institutional forum, so-called International Monetary Fund (IMF), for the international co-operation on money matters: to set up, stabilize, and watch over exchange rates. Fourth, to remove all the existing exchange controls limiting (protectionism) policies by the members, on the use of its currency for international trade. In practice the first scheme, as well as its later development and final demise, were directly dependent on the preferences and policies of its most powerful member, the United States. According to John Gerard Ruggie, 1982, this Bretton woods system of monetary co-operation represented the type of liberalism which characterise “domestic social economic stability along with a liberal trading order.” He referred this system as ‘embed...
Entering the 21st. Century – World Development Report 1999/2000. World Bank 2000. Oxford University Press. New York, NY 2000.
the effect that the work of the IMF and the World Bank have had on the
Joseph Stiglit’s focused on criticizing the International Monetary Fund (IMF) and how globalization makes the rich countries richer and the poor countries poorer. At first, I thought that the book was too technical for a beginner on the subject to understand, but he was able explain well the contents of this book. This book is very informational for people, who are into globalization and economic development. His sharp critiques on globalizations, particularly on the International Monetary Fund (IMF), that was based on his own experiences. In this book, he emphasized the effect of globalization on the Least Developed Countries as well as on the Developed Countries. I chose On Globalization and its Discontent because aside from the striking title of the book, it also the sincere opinions of Joseph Stiglitz. Also, I chose this book aside from it being required, I figured out that this book will be of good help for me in the near future – if I want to pursue this track – with all the information that were given by Stiglitz.
Reflective Journal: The International Monetary Fund and its functions The International Monetary Fund (IMF) works to foster economic growth and economic stability, which is an association that mainly creates the stability in exchange rates and offers temporary loans for the state members in order to tackle their balance of payment problems. Besides, the members contribute their national currencies to the IMF pool for providing loans to deficit countries. In addition, the IMF article of agreement has emphasized that the members had to peg their currencies to gold or US dollars. The IMF utilizes its gold holdings to acquire dollars and other currencies for its operations. The capital of the IMF consists of the aggregate of the quotas allotted to the member countries; member can pay its quota in its national currency.
The basic mission of IMF is to help and ensure stability in the international system. It does its job in three ways: keeping track of the global economy and the economies of member countries: lending to countries with balance of payments difficulties: and practical he...
7. IMF staff. (June 2000). Recovery from the Asian Crisis and the Role of the IMF. International Monetary Funds. Retrieved April 27, 2008 from,
World Bank Group - the group that consists of five organizations created in different times and functionally united,organizationally and geographically, the purpose of which is providing financial and technical assistance to developing countries.
United Nations, (2013) the millennium development goals report 2013 [ONLINE] United Nations. Available at: http://www.un.org/en/development/desa/publications/mdgs-report-2013.html [Accessed on 26 December 2013]
According to Pease (2012), an international organization are conceived as formal institutions whose members are states and these are divided into two sub-groups called intergovernmental organizations (IGO) and non-governmental organizations (NGO). An IGO consists of states that voluntarily join, contribute financially, and assist in the decision making process. All of their members’ resolves, structures, and administrative protocols are clearly outlined in the treaty or charter. An example of an IGO is the North Atlantic Treaty Organization (NATO). First, all IGOs comes from an established government which can be further categorized by rules of membership which qualifies NATO because it is an alliance of about 30 members from North America and Europe. Secondly, IGOs can have limited participation in membership or restricted membership which qualifies NATO because this is a security agreement and it limits its involvement by confining it to an amalgamation of specific governmental, geographical, and martial considerations. Thirdly, IGOs are categorized by their purpose meaning the member can be multi or general purpose organization and they can take on any global issue (Pease, 2012). This qualifies NATO because over the years the organization has participated in several international war related issues such as the Korean War and the Cold War. Most recently, NATO, for the first time in history had to engage Article 5 of the treaty after the 9/11 attacks in New York City and the no-fly zone in the country of Libya.
World Bank. Independent Evaluation Group. World Bank (2013). Results and performance of the World Bank Group: Volume 1. Retrieved from World Bank website: http://siteresources.worldbank.org/PROJECTS/Resources/40940-1367867968385/2013_WorldBankforResults.pdf
In the year 2000 the United Nations set out a goal to stop hunger poverty and unfair living to people of the world not just the United States. This idea was called the Millennium Development Goals (MDG). Upon taking on a task such as this the UN wanted to break down goals in sections of eight to better categorize them to use every resource they had to make this plan possible. Not every catgeroy had the same plan put in place and for that exact reason these goals where not something to be done over night, hence how the name of the idea started with millennium. The UN has also been known for their work to gather its members and countries as one to work to accomplish its goals of maintaining peace and security, they wanted to protect human rights by providing humanitarian assistance, and assisting economic and social development throught the world. This gives us a better idea of what MDG project is for and how it was created.
In 2015, President Barack Obama addressed the United Nations General Assembly and talked about the significance the United Nations has had since its creation in 1945, claiming: “This institution [U.N.] was founded because men and women who came before us had the foresight to know that our nations are more secure when we uphold basic laws and basic norms, and pursue a path of cooperation over conflict. And strong nations, above all, have a responsibility to uphold this international order.” President Obama argues that the U.N. is the glue which holds the international system together and promotes mutually beneficial outcomes for the world. The fact that an international organization (IO) such as the U.N. has endured for over 70 years is some
The International Monetary Fund, or IMF for short, was a foundation established in 1944 at Bretton Woods, New Hampshire, at the end of World War II. The idea behind establishing the IMF was simple: prevent another cataclysmic economic failure such as the Great Depression, which shook the world in the 1930 's. However, the IMF was also established for a few other goals such as stabilizing currency exchange rates, aiding economic stability and reducing unemployment in third world countries. One major criticism of the IMF by anti-globalization protesters is that the IMF pushes western views, and this has some validity in the way the power is structured among countries in