International Monetary Fund (IMF)

1
International Monetary Fund (IMF)

• Ms. Sarah Jocelyn Pawlak
• Mr. Brian Edward Tesser

2
Roles of the IMF?What is it?

• International monetary cooperation
• Exchange rate stability
• Balanced growth of international trade
• Poverty reduction
• Helps members balance debt
• Agency of the UN
• Has its own charter, governing structure, finances

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Important Documents

• Articles of Agreement
• December 27, 1945
• 31 Articles
• Have roman numerals attached to them (I-XXXI)
• General obligations of members (VIII), Capital
  transfers (VI), Obligations regarding exchange
  arrangements (IV)
• 13 Schedules
• Have letters attached to them (A-M
• Quotas (A), Termination of Participation (H),
  Suspension of Voting Rights (L)
• Can be, and has been amended.

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Age of IMF

• Bretton Woods, New Hampshire, United States
• July 1944
• Officially created 1945
• 44 countries were represented.
• Avoid economic policies that could create a
  situation similar to the Great Depression

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Changes since 1945

• Increased monetary support during crisis
• Greater flexibility regarding loans
• Gives advice to member nations
• Rectifies flaws after a crisis
• Reform of governance

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Purpose

• WORLD FINANCIAL STABILITY
• Provide Economic Cooperation
• Trade Growth
• Employment Opportunities
• Lessened Poverty
• Exchange Rate Stability
• Open System of International Payment
• Monetary Loans

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Membership

• Currently 187 Countries
• Some countries not included Cuba, North Korea,
  Vatican City
• Members are represented through a quota system
  based on their involvement in the global economy
• EX US has more representation than Kenya

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Leadership
Who wants the last spoonful of Guac?!

• 24 Member Executive Board
• 5 Executive Directors Appointed by 5 Countries
  with the largest quotas
• 19 Executive Directors Elected by remaining
  members
• Managing Director- Chairman of the Executive
  Board
• Controls major decisions within the IMF
• All member countries appoint a governor to the
  Board of Governors
• All countries are proportionally represented
  based on economic rank
• Meets several times a week
• Elections/Appointments occur every 2 years- Can
  be reelected

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Leaders

• Managing Director- Christine Lagarde- France
• 5 Appointed Executive Director
• Meg Lundsager- USA
• Mitshuiro Furusawa- Japan
• Hubert Temmeyer- Germany
• Ambroise Fayolle- France
• Alexander Gibbs- United Kingdom
• Others
• Carlos Perez-Verdia- Mexico
• Tao Zhang- China
• Aleksei V. Mozhin- Russia
• Jafar Mojarrad- Iran

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Advantages of Membership

• International Monetary Cooperation
• Financial Stability
• Temporary Financial Help when in debt
• Financial Advice
• Increased chance of Economic Growth

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Disadvantages of Membership

• Rich countries have more influence than poorer
  countries
• Only receives loans if a country will agree to
  conditions
• Conditions may lead to increased poverty
• Rich countries often dominate foreign resources
• Financial advice is not always sound

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International Impact Mexico

• Biggest Precautionary Loans
• In December, 2011, the Executive Board reviewed
  Mexicos request to access Flexible Credit Line
  resources.
• Aid was given to Mexico
• Because of the IMF, Mexican credibility in the
  global economy has increased
• Introduced Structural Adjustment programs

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International Impact Nigeria

• IMF introduced the concept of Structural
  Adjustment programs
• Nigeria has benefitted from them
• Has enabled them to create a free market economy

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International Impact United Kingdom

• The UK is one of the top 5 countries involved in
  the IMF
• One of the appointed Executive Directors due to
  their large quota
• Very influential in the IMF

15
Works Consulted
Forbes. Forbes Magazine. Web. 23 Mar. 2012.
lthttp//www.forbes.com/2009/04/02/ mexico-imf-cred
it-business-oxford.htmlgt. "IMF -- International
Monetary Fund Home Page." Document Moved. Web. 23
Mar. 2012. lthttp//www.imf.org/external/gt. "The
International Monetary Fund." International
Organisations. Web. 23 Mar. 2012.
lthttp//www.oxfam.org.uk/education/resources/milk
ing_it/milkingit/information/ international_orgs/i
nternational_orgs_imf.htmgt. "Structural
Adjustment Programs in Nigeria." Structural
Adjustment Programs in Nigeria. Web. 23 Mar.
2012. lthttp//sapnigeria.wordpress.com/gt. "Top
Ten Reasons to Oppose the IMF." IMF. Web. 23 Mar.
2012. lthttp// www.thirdworldtraveler.com/IMF_WB/T
enReasons_OpposeIMF.htmlgt.