Critically Evaluate the Debates Surrounding the Continuity of Bretton Woods’s Institutions. Which of These Institutions Would You Recommend to Be Discontinued? Justify Your Choice.
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3. Critically evaluate the debates surrounding the continuity of Bretton Woods’s institutions. Which of these institutions would you recommend to be discontinued? Justify your choice.
While preparing to rebuild the international economic system after WWII, 730 delegates of the 44 allied nations met in New Hampshire, United States, to form the Bretton Woods agreement. The aim was to set up rules and regulations to stabilize the global monetary system and ensure the free movement of capital goods through a global market. The agreement established two regulatory institutions, firstly the International Monetary Fund (IMF) to control the exchange rates and bridge temporary imbalances of payment. Secondly, the International Bank of Reconstruction and Development (IBRD), later known as the World Bank, which was founded to finance the reconstruction of post war Europe. In 1947 the Havana Charter proposed a third regulatory institution, the International Trade Organization (ITO) that transformed into the World Trade Organization (WTO). This essay will critically evaluate the performance of the three Bretton Wood´s institutions, giving recommendations to operational changes for the IMF and the WTO, and argue to discontinue the WB as it operates currently.
The IMF was one of the key institutions that stabilized the world economy after WWII. Its initial goal was to regulate and stabilize exchange rates and assists the reconstruction of the world’s international payment system. One of the key objectives of the IMF was to prevent the devaluation cycle. Through joining the IMF in the post War period, countries surrendered their economic rights, especially on setting its exchange rate, in return they were guarantied “exchange stability, avoidance of competitive exchange depreciation and a liberal regime of international repayments” (deVries, 1986). Essentially the original conception behind the IMF, was to control the behaviour of countries that joined the IMF,
3. Critically evaluate the debates surrounding the continuity of Bretton Woods’s institutions. Which of these institutions would you recommend to be discontinued? Justify your choice.
While preparing to rebuild the international economic system after WWII, 730 delegates of the 44 allied nations met in New Hampshire, United States, to form the Bretton Woods agreement. The aim was to set up rules and regulations to stabilize the global monetary system and ensure the free movement of capital goods through a global market. The agreement established two regulatory institutions, firstly the International Monetary Fund (IMF) to control the exchange rates and bridge temporary imbalances of payment. Secondly, the International Bank of Reconstruction and Development (IBRD), later known as the World Bank, which was founded to finance the reconstruction of post war Europe. In 1947 the Havana Charter proposed a third regulatory institution, the International Trade Organization (ITO) that transformed into the World Trade Organization (WTO). This essay will critically evaluate the performance of the three Bretton Wood´s institutions, giving recommendations to operational changes for the IMF and the WTO, and argue to discontinue the WB as it operates currently.
The IMF was one of the key institutions that stabilized the world economy after WWII. Its initial goal was to regulate and stabilize exchange rates and assists the reconstruction of the world’s international payment system. One of the key objectives of the IMF was to prevent the devaluation cycle. Through joining the IMF in the post War period, countries surrendered their economic rights, especially on setting its exchange rate, in return they were guarantied “exchange stability, avoidance of competitive exchange depreciation and a liberal regime of international repayments” (deVries, 1986). Essentially the original conception behind the IMF, was to control the behaviour of countries that joined the IMF,
References: Bretton Woods Project. What are the main concerns and criticism about the World Bank and IMF? Available: http://www.brettonwoodsproject.org/item.shtml?x=320869 (Accessed: 15 March.2012) de Vries,M.G Griesgraber,J.M. Gunter B.G. (1996) The World’s Monetary System: towards stability and Sustainability in the Twenty-first Century. London: Pluto Press Hill C.W.L Irwin,A.I. (1999) Do we need the WTO? Available: http://www.cato.org/pubs/journal/cj19n3/cj19n3-2.pdf (Accessed: 17 March. 2012) Kruger,A Legrain,P. (2007) Open World: The Truth about Globalisation. Chicago: Ivan R.Dee Peet,R Peet,R. (2003) Unholy Trinity, The IMF, World Bank and WTO 2nd ed. London: Zed Books Pettinger,T Schaffer,G. (2009, February 24) Future of the WTO- Liberal Ideas and Domestic Politics. Available: http://uchicagolaw.typepad.com/faculty/2009/02/future-of-the-wto-liberal-ideas-and-domestic-politics-gregory-shaffer.html (Accessed 20 March. 2012) Sinha,A Stiglitz,J. (2002) Globalization and its Discontents. London: Penguin Books Stiglitz,J. (2007) Making Globalization Work: The Next Steps to Global Justice. London: Penguin Weisbrot,M World Bank Group. (2011) Azerbaijan Highway Program. Available: http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,print:Y~isCURL:Y~contentMDK:22739570~menuPK:64256345~pagePK:34370~piPK:34424~theSitePK:4607,00.html (Accessed 20 March. 2012) WTO