International Monetary Fund (IMF)

We explain what the International Monetary Fund is, its history, objectives, functions and member countries. Also, the World Bank.

What is the International Monetary Fund (IMF)?

The International Monetary Fund, known by its acronym IMF, It is an international organization dedicated to international economic cooperation the promotion of international trade and the promotion of exchange stability and work. To this end, it offers various financial aid strategies and support for local economic policies.

That is to say, the International Monetary Fund is the main international organization dedicated to maintaining the macroeconomic system. It is made up of 189 countries different that make a percentage of their international financial reserves available to the fund. Its headquarters are located in Washington, United States.

However, this organization functions with a corporate spirit, and not according to the horizontality of most international diplomatic or political institutions (one country = one vote). That is to say, The countries that have the largest financial participation quotas in the IMF are the ones that have the greatest voting power in their decisions and in their policies.

From time to time, these quotas are reviewed and emerging economies have the option of gaining greater participation.

The structure of the International Monetary Fund is made up of an Assembly of Governors that makes decisions and elects a Council of Directors that functions as its executive arm. As there are only 24 directors, each one represents more than one country, or a specific region.

See also: Default

History of the International Monetary Fund

The IMF It was officially founded in 1945 at the end of the Second World War, although it had already emerged as an idea the previous year, during the Bretton Woods Agreements. The IMF was created to ensure the stability of the world's economic and financial system after the brutal economic depression of 1929.

The IMF emerged from the World Bank, the International Bank for Reconstruction and Development (IBRD) and the General Agreement on Tariffs (GATT), as part of a series of organizations designed to preserve economic stability and lay the foundations for the advent of global trade.

In all of this there was a notable influence of the United States victorious power of World War II (which later faced the Soviet Union in the Cold War). For this reason, economic integration plans, such as the creation of a world bank with its own currency, were rejected to maintain the primacy of the dollar.

With the disappearance of the fixed exchange rate, Starting in 1976, the IMF focused its attention on developing nations and in participation in international economic crises. Many of the criticisms of his management come from that time, accused of collaborating with right-wing Latin American dictatorships.

Furthermore, he is criticized for promoting a model of neoliberal capitalism that openly favors the interests of the United States, even when this means subjecting poorer nations to cruel and strict economic regimes.

IMF objectives

The International Monetary Fund pursues the fundamental objective of promotion of economic exchange and international trade in the world, especially among less industrialized countries that need help to achieve economic and financial growth rates.

Also offers loans and economic supervision to countries devastated by crisis or misgovernment In this way, its main goal is to be the institution that promotes economic growth on the planet, in order to maintain the balance of the system and prevent crises or severe economic fluctuations.

Functions of the IMF

Among the different functions that the IMF performs we can find:

• Provide financial support to countries in need, in the form of multimillion-dollar loans accompanied by a certain margin of economic supervision.
• Advise economic policies of developing nations that request tutelage from the institution.
• Keep track of economic performance of the countries that make up the Fund and make recommendations in this regard.
• Perform measurements, statistical analysis and predictions on the global, regional and national economic situation.

IMF member countries

There are currently 189 member countries of the International Monetary Fund, of which 29 are also founding countries. These nations are:

International Monetary Fund and World Bank

Both the IMF and the World Bank were created at the Bretton Woods Conference of 1944 and since then they have carried out complementary, although autonomous, tasks. The World Bank has been involved in the fight against poverty and underdevelopment in less industrialized countries.

For its part, the IMF seeks to stabilize the global financial system. Thus, while the World Bank emphasizes strengthening the private sector of nations, the International Monetary Fund offers tutelage and economic advice to their respective State organizations.

Continue with: World Health Organization (WHO)

References

• “International Monetary Fund” in Wikipedia.
• “International Monetary Fund – IMF” in the United Nations (UN).
• “International Monetary Fund” in the Ministry of Foreign Affairs of Brazil.
• “The World Bank Group and the International Monetary Fund (IMF)” at the World Bank.
• “International Monetary Fund” in The Encyclopaedia Britannica.
• Official Site of the International Monetary Fund (English).