19-09-2017, 03:03 PM
The International Monetary Fund (IMF) is an international organization based in Washington, DC, of 189 countries working to promote global monetary cooperation, ensure financial stability, facilitate international trade, promote employment and sustainable economic growth, and reduce poverty around the world. "Formed in 1944 at the Bretton Woods Conference mainly for the ideas of Harry Dexter White and John Maynard Keynes, it came into formal existence in 1945 with 29 member countries and the goal of rebuilding the international payments system. the management of balance of payments difficulties and international financial crises Countries provide funds to a pool through a quota system where countries experiencing balance of payments problems can borrow money From 2016 , the fund had $ 475 million (about $ 668 billion).
Through the fund and other activities such as collection of statistics and analysis, supervision of the economies of its members and the demand for particular policies, the IMF works to improve the economies of its member countries. The objectives of the organization established in the Articles of Agreement are: to promote international monetary cooperation, international trade, high employment, exchange rate stability, sustainable economic growth and making resources available to member countries in financial difficulties .
According to the IMF itself, it works to foster global growth and economic stability by providing policy, advice and funding to members, working with developing countries to help them achieve macroeconomic stability and reduce poverty. The reason for this is that private international capital markets function imperfectly and many countries have limited access to financial markets. These market imperfections, together with balance of payments financing, justify official financing, without which many countries could only correct large imbalances of external payments through measures with adverse economic consequences. The IMF provides alternative sources of funding.
Following the founding of the IMF, its three main functions were to monitor fixed exchange rate agreements between countries, thereby helping national governments manage their exchange rates and enable these governments to prioritize economic growth and provide short-term capital term to help countries balance of payments. This aid was intended to prevent the spread of international economic crises. The IMF also intended to help repair parts of the international economy after the Great Depression and World War II. Also, to provide capital investment for economic growth and projects such as infrastructure.
The role of the IMF was fundamentally altered by floating exchange rates after 1971. It went on to examine the economic policies of the countries with IMF loan agreements to determine whether the capital shortage was due to economic fluctuations or economic policies. The IMF also investigated what types of government policies would ensure economic recovery. A particular concern of the IMF was to prevent the financial crisis, such as Mexico 1982, Brazil in 1987, East Asia in 1997-98 and Russia in 1998, and threatening the entire global financial and monetary system. The challenge was to promote and implement policies that would reduce the frequency of crises among emerging market countries, especially middle-income countries that are vulnerable to massive capital outflows. Instead of maintaining a position of monitoring exchange rates, monitoring the overall macroeconomic performance of member countries. Their role became much more active because now the IMF administers economic policy rather than simply exchange rates.
In addition, the IMF negotiates loan and loan conditions under its conditionality policy, established in the 1950s. Low-income countries can borrow on favorable terms, which means that there is a no-interest time period, through the Expanded Credit Facility (ECF), the Reserve Credit Facility (SCF) and Facility Fast Credit. Non-concessional loans, which include interest rates, are mainly provided through Stand-By (SBA), Flexible Credit Line (FCL), Precautionary and Liquidity Line (PLL) and Expanded Fund. The IMF provides emergency assistance through the Rapid Financing Facility (RFI) to members facing urgent balance of payments needs.
Through the fund and other activities such as collection of statistics and analysis, supervision of the economies of its members and the demand for particular policies, the IMF works to improve the economies of its member countries. The objectives of the organization established in the Articles of Agreement are: to promote international monetary cooperation, international trade, high employment, exchange rate stability, sustainable economic growth and making resources available to member countries in financial difficulties .
According to the IMF itself, it works to foster global growth and economic stability by providing policy, advice and funding to members, working with developing countries to help them achieve macroeconomic stability and reduce poverty. The reason for this is that private international capital markets function imperfectly and many countries have limited access to financial markets. These market imperfections, together with balance of payments financing, justify official financing, without which many countries could only correct large imbalances of external payments through measures with adverse economic consequences. The IMF provides alternative sources of funding.
Following the founding of the IMF, its three main functions were to monitor fixed exchange rate agreements between countries, thereby helping national governments manage their exchange rates and enable these governments to prioritize economic growth and provide short-term capital term to help countries balance of payments. This aid was intended to prevent the spread of international economic crises. The IMF also intended to help repair parts of the international economy after the Great Depression and World War II. Also, to provide capital investment for economic growth and projects such as infrastructure.
The role of the IMF was fundamentally altered by floating exchange rates after 1971. It went on to examine the economic policies of the countries with IMF loan agreements to determine whether the capital shortage was due to economic fluctuations or economic policies. The IMF also investigated what types of government policies would ensure economic recovery. A particular concern of the IMF was to prevent the financial crisis, such as Mexico 1982, Brazil in 1987, East Asia in 1997-98 and Russia in 1998, and threatening the entire global financial and monetary system. The challenge was to promote and implement policies that would reduce the frequency of crises among emerging market countries, especially middle-income countries that are vulnerable to massive capital outflows. Instead of maintaining a position of monitoring exchange rates, monitoring the overall macroeconomic performance of member countries. Their role became much more active because now the IMF administers economic policy rather than simply exchange rates.
In addition, the IMF negotiates loan and loan conditions under its conditionality policy, established in the 1950s. Low-income countries can borrow on favorable terms, which means that there is a no-interest time period, through the Expanded Credit Facility (ECF), the Reserve Credit Facility (SCF) and Facility Fast Credit. Non-concessional loans, which include interest rates, are mainly provided through Stand-By (SBA), Flexible Credit Line (FCL), Precautionary and Liquidity Line (PLL) and Expanded Fund. The IMF provides emergency assistance through the Rapid Financing Facility (RFI) to members facing urgent balance of payments needs.