How Imf Has Assisted in the Underdevelopment of Third World Countries
According to the The International Monetary Fund (IMF) is an international financial institution (IFI) which monitors the international financial system and provides loans to developing country member-states with balance-of-payments problems. (www.IMF.com)
History of IMF
The IMF was established in 1945, having first been conceived at the Bretton Woods Conference in New Hampshire, USA in 1944. That conference saw representatives from forty four allied nations gather to craft new rules and institutions to regulate the chaotic global economy – blamed for the Great Depression and for helping cause two World Wars. The outcome was the Bretton Woods Agreement which created two new multilateral institutions: the International Bank for Reconstruction and Development (IBRD), now known as the World Bank, and the International Monetary Fund. (www.IMF.com)
The creation of the IMF was a ‘compromise’ between the proposals put to the Bretton Woods conference by head negotiators from England and the USA: John Maynard Keynes and Harry Dexter White. Keynes advocated the establishment of a global bank called the International Clearing Union, which would have divided the responsibility for balance-of-payments imbalances between both the debtor and creditor nations. But the United States was at the time not just the most economically powerful nation in the world, but also the world’s largest creditor. As a result, it was White’s proposal for a Fund which favoured creditor nations by placing the world’s debt burden solely on debtor nations which won out in the end, altered only slightly by a few concessions to Keynes. (Bob Davis 2010)
The IMF’s responsibilities: The IMF 's primary purpose is to ensure the stability of the international monetary system the system of exchange rates and international payments that enables countries (and their citizens) to transact with one other. This system is essential for promoting sustainable economic growth, increasing living standards, and
History of IMF
The IMF was established in 1945, having first been conceived at the Bretton Woods Conference in New Hampshire, USA in 1944. That conference saw representatives from forty four allied nations gather to craft new rules and institutions to regulate the chaotic global economy – blamed for the Great Depression and for helping cause two World Wars. The outcome was the Bretton Woods Agreement which created two new multilateral institutions: the International Bank for Reconstruction and Development (IBRD), now known as the World Bank, and the International Monetary Fund. (www.IMF.com)
The creation of the IMF was a ‘compromise’ between the proposals put to the Bretton Woods conference by head negotiators from England and the USA: John Maynard Keynes and Harry Dexter White. Keynes advocated the establishment of a global bank called the International Clearing Union, which would have divided the responsibility for balance-of-payments imbalances between both the debtor and creditor nations. But the United States was at the time not just the most economically powerful nation in the world, but also the world’s largest creditor. As a result, it was White’s proposal for a Fund which favoured creditor nations by placing the world’s debt burden solely on debtor nations which won out in the end, altered only slightly by a few concessions to Keynes. (Bob Davis 2010)
The IMF’s responsibilities: The IMF 's primary purpose is to ensure the stability of the international monetary system the system of exchange rates and international payments that enables countries (and their citizens) to transact with one other. This system is essential for promoting sustainable economic growth, increasing living standards, and
References: Davis, Bob (2010-05-03). "IMF 's Sweeping Demands Signal Shift - WSJ.com Retrieve from http://online.wsj.com/article/SB10001424052748704608104575220652201803546.html?mod=WSJ_latestheadlin