IMF
~
What is the historical context behind the IMF ?
setting up of the
Was set up to oversee the monetary order after the Sww came into existence in 1947
·
,
monetary field by
Its Chief purpose was to encourage international cooperation in the foreign exchange restrictions
·
removing
By 1970s role changed lender to the developing world post the Cold War.
·
to
being a
&
Today the IMF continues to monitor the economic health and
Stability of its members and warns
against policies that could be damaging to the
economy. (known as Surveillance) E g IMF warned Mexico they
-
were too relient on oil as its main source of revenue .
-
What is the IMFs changing role ?
Role of the IMF /1947) : Stabilize exchange IMF had to fixed between currencies . Countries
exchange rates
I
rates , ensure were
expected to
pey their currencies to the US dollar which : was in turn tied to gold . known as the Bretton Woods System .
International trade
i Promotingto by maintaining helping
,
Stable exchange rates and to resolve BOP problems , the IMF
-
almed foster economic cooperation .
Provide financial assistance , designed to provide temporary financial assistance to countries facing economic crisis
Surveillance 2Policy Advice It monitors global economic trends and provides policy recommendations
,
on fiscal,
and exchange rate policies to help countries maintain stability9 foster growth.
monetary
Providing financial assistance ,
IMF continues to provide financial assistance to countries facing BOP problems, however
Its scope has changed now helps countries sovereign debt crises , currency crises facing and banking sector crisis.
· The IMF offers loans but with conditions attached to it , which often require countries to Implement economic
reform .
Central global financial Stability initially focused on nation balance of payments problems and fixed exchange rates
role in ,
2008 Global Financial Crisis , the IMF became more involved in
monitoring and issues on a
addressing
global scale .
-
How does the membership work 2 how does funding work ?
·
The IMF has their board of governers , which is the highest decision making body in the IMF ,
consists of
one
governer+ an alternative governer for each member country.
·
IMF's /funding) loans are provided by member countries primarily through their payments , i quotas
·
Voting the quota relatively determines a members loting power in IMF decisions
,
each member of the IMF assigned a quota based broadly onits relative size inthe world economy
is ,
the larger a countrys economy is the higher the quota and the more voting rights it has /America 17% Of the
quota
-
What are SAPS ? How do
they work? How were
they justified ?
·
Structural adjustmentProgrammes ,
these were the onward conditions placed on countries who borrowed
money from the IMF
·
The 'One size fits all"application was based on the principle that Iriflation had to be controlled above
anything else
through this : Devaluation of currency
·
Fiscal Policy
Privitisation of state owned industries
Trade liberalisation
SAPs intended that the IMF was actually helping to prevent financial crisis rather than
merely funding
·
to ensure
financial recklessness .
Officials at the IMF2 World Bank development which would foster innovation
·
the key to was market reform and enterprise that they
believed would foster economic
growth
~
What is the historical context behind the IMF ?
setting up of the
Was set up to oversee the monetary order after the Sww came into existence in 1947
·
,
monetary field by
Its Chief purpose was to encourage international cooperation in the foreign exchange restrictions
·
removing
By 1970s role changed lender to the developing world post the Cold War.
·
to
being a
&
Today the IMF continues to monitor the economic health and
Stability of its members and warns
against policies that could be damaging to the
economy. (known as Surveillance) E g IMF warned Mexico they
-
were too relient on oil as its main source of revenue .
-
What is the IMFs changing role ?
Role of the IMF /1947) : Stabilize exchange IMF had to fixed between currencies . Countries
exchange rates
I
rates , ensure were
expected to
pey their currencies to the US dollar which : was in turn tied to gold . known as the Bretton Woods System .
International trade
i Promotingto by maintaining helping
,
Stable exchange rates and to resolve BOP problems , the IMF
-
almed foster economic cooperation .
Provide financial assistance , designed to provide temporary financial assistance to countries facing economic crisis
Surveillance 2Policy Advice It monitors global economic trends and provides policy recommendations
,
on fiscal,
and exchange rate policies to help countries maintain stability9 foster growth.
monetary
Providing financial assistance ,
IMF continues to provide financial assistance to countries facing BOP problems, however
Its scope has changed now helps countries sovereign debt crises , currency crises facing and banking sector crisis.
· The IMF offers loans but with conditions attached to it , which often require countries to Implement economic
reform .
Central global financial Stability initially focused on nation balance of payments problems and fixed exchange rates
role in ,
2008 Global Financial Crisis , the IMF became more involved in
monitoring and issues on a
addressing
global scale .
-
How does the membership work 2 how does funding work ?
·
The IMF has their board of governers , which is the highest decision making body in the IMF ,
consists of
one
governer+ an alternative governer for each member country.
·
IMF's /funding) loans are provided by member countries primarily through their payments , i quotas
·
Voting the quota relatively determines a members loting power in IMF decisions
,
each member of the IMF assigned a quota based broadly onits relative size inthe world economy
is ,
the larger a countrys economy is the higher the quota and the more voting rights it has /America 17% Of the
quota
-
What are SAPS ? How do
they work? How were
they justified ?
·
Structural adjustmentProgrammes ,
these were the onward conditions placed on countries who borrowed
money from the IMF
·
The 'One size fits all"application was based on the principle that Iriflation had to be controlled above
anything else
through this : Devaluation of currency
·
Fiscal Policy
Privitisation of state owned industries
Trade liberalisation
SAPs intended that the IMF was actually helping to prevent financial crisis rather than
merely funding
·
to ensure
financial recklessness .
Officials at the IMF2 World Bank development which would foster innovation
·
the key to was market reform and enterprise that they
believed would foster economic
growth
