By: Stefan Devas, Shayaan Khan, Alex Leung, and Karen Markwick.
IMFWHITE.GIF
Text1.GIF


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Wh.GIF
The International Monetary Fund is comprised of 185 countries. It works to:
  • Forster global monetary cooperation
  • Secure financial stability
  • Facilitate international trade
  • Promote high employment and sustainable economic growth
  • Reduce poverty globally

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The IMF does three main types of work to ensure these:
  1. Surveillance: The IMF supervises economic and financial policies, of all the 185 members, by advising of possible risks to countries’ stability and growth, and policy adjustments needed.
  2. Lends: The IMF lends money to countries experiencing balance of payment difficulties
  3. Technical Assistance: The IMF provides technical assistance to any country that needs it by supporting the development of resources production, which allows them to effectively manage economic and financial affairs. The executive board of the IMF is made up of 24 countries. The permanent members of the IMF are United States, Japan, France, United Kingdom, Germany, China, Russia, and Saudi Arabia. The remaining 16 places are countries elected on two year terms. This allows a country to regain economic stability and allow for growth. The IMF does not lend for specific projects.
[Taken from http://whatsinbiz.files.wordpress.com/2008/04imf_international_monetary_fund_h_q.jpg]
History.GIF
When was it Initiated

The International Monetary Fund (IMF)was first initiated in July of 1944 during the United Nations Monetary and Financial Conference. The conference began on July 1st 1944, in the solitude of Bretton Wood, New Hampshire. The Bretton Woods Agreement was designed to bring a structure and economic stability to the post-war world. A total of 44 governments from around the world accepted President Roosevelt’s invitation to the conference and from this point the first steps to rebuilding the worlds economy began. At the Bretton Woods agreement both plans for the future International Monetary Fund and the World Bank where discussed. The IMF was officially introduced in December of 1945 when the first 29 members signed the articles of agreement. Operations began on March 5th 1947 and France became the first country to borrow money from the IMF. The Fund continued to grow with the membership of many newly independent African nations. However during the Cold War period the IMF had limited membership from the Soviet Union and neighboring countries.
What issue was it created to solve?
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The IMF was created to prevent a repetition of the disastrous effects of the Great Depression in the 1930s. There were many economic policies that lead to the Great Depression. Representatives from 45 governments gathered together to
change or remove these economic policies. Great Depression: The 1929 stock marker crash caused the longest and most sever economic downturn in American history. Results of the stock market crash are as follows: High unemployment rates (high of one third of the American population) Economic output fell 10% a year Half of the commercial banks of the United States failed during the depression
As of today, the IMF has contributed to many of the changes in the world's economic systems to promote the stability of the international financial system. The IMF is responsible for the following:
  • Promoting international monetary cooperation
  • Establish international trade
  • Promoting exchange stability
  • Providing financial resources to members countries experiencing financial difficulties





[Taken From: http://www.unodc.org/images/money-laundering/handshake.jpg]

outcomes.GIF

Positive Affects

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The IMF has assisted countries whose exchange rates were plummeted. They provided money primarily so that developing countries can pay off foreign creditors and private banks. The IMF has intervened in financial situations all over the world:

  1. United States – In 1995, due to the peso devaluation in Mexico, Wall Street was stood to lose billions. The IMF contributed $18 billion to a Clinton administration bailout.

  2. United States – The United States banks had approximately $20 billion in outstanding debt in South Korea. The IMF intervened and pushed the government to take on the debts of failing private sector companies and provided tens of billions of dollars to the government to pay off the debt owed to private companies.

  3. Russia – In August 1998, the IMF removed multi-billion dollar Russian debt.

[Taken From: http://barbadosfreepress.files.wordpress.com/2007/04/owen-arthur-barbados-bribes-bim.jpg]


Negative Affects

Although the IMF has good intentions, there are some negative affects to the IMF:

  1. Since 1992, IMF played the central role in designing and supervising post-communist Russia’s economic policy. The number of Russians in poverty since this time has risen from 2 million to 60 million. The male life expectancy drooped from 65 years to 57 years. Economic output decreased by at least 40%.



current_c.GIF
IMF is continuing to help governments learn from the August 2007
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sub prime crisis that erupted. The crisis in 2007, had slowed down world growth and exposed instability in the global financial structure.

Those who suffer from high food prices and fuel prices, and are not able to afford them; IMF is helping low-income countries by encouraging them on social spending (IMF believes Africa needs more spending on Health care). However, the IMF believes that spending on health care won’t be enough to achieve better outcomes. Thus, they believe that adequate financing for water and sanitation should be enforced. Other ways on how the IMF is providing a helping hand to low-income countries are promoting aid effectiveness. There are too many donors who contribute too little. 3 problems occur from this:
  • Lack of predictability- 45% of aid packages arrive on time,
  • Lack of coordination and Aid fragmentation- occurs with the increase in donors and
  • “Proliferation of donor-funded activities”.


[Taken from: http://www.imf.org/external/pubs/ft/fandd/2008/09/deutscher.htm]

Videos:
1) 1944 Bretton Woods International Monetary Conference


2) The World Bank (WB) & The International Monetary Fund (IMF)




bibli.GIF
  1. "About the IMF: On the Agenda: Tackling current challenges." IMF -- International Monetary Fund Home Page. 12 Nov. 2008 http://www.imf.org/external/about/onagenda.htm#crisis
  2. "About the IMF: History: Cooperation and reconstruction (1944–71)." IMF -- International Monetary Fund Home Page. 16 Nov. 2008 http://www.imf.org/external/about/histcoop.htm
  3. "Finance & Development, September 2008 - Improving the Effectiveness of Aid." IMF -- International Monetary Fund Home Page. 13 Nov. 2008 http://www.imf.org/external/pubs/ft/fandd/2008/09/deutscher.htm Results.org.
  4. "The International Monetary Fund (IMF)." Results.org. 5 Nov. 2005. 12 Nov. 2008 http://www.results.org/website/article.asp?id=371 _
  5. IMF History and Conditions. 13 Nov. 2008 <http://ucatlas.ucsc.edu/sap/history.php>.
  6. "www.agp.org | archives of global protests: IMF versus Russia." nadir aktuell | Startseite 11.11.2008 / 18:56__. 16 Nov. 2008 <http://nadir.org/nadir/initiativ/agp/free/imf/europe/imf_russia.htm>.