The World Bank : An International Financial Institution Essay

The Bretton Woods Institutions take their name from a multilateral conference held in July 1944 at the Bretton Woods resort in New Hampshire. The narrow definition of Bretton Woods Institutions refer to the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), while they were only part of a much

The Bretton Woods system was created in July 1944 by the United States and its allies in order to formulate a plan for European recovery and create a new postwar international monetary and financial system that was supposed to encourage grow and development (Balaam, Dillam 2011). The Bretton Woods financial and monetary structure was supposed to ensure exchange rate stability and encourage its member countries to eliminated exchange rate restrictions that hinder trade. The International Monetary Fund (IMF) and the World Bank were conceived by the Bretton Woods system (International Monetary Fund). The countries that joined the IMF adopted an alternated version of the former gold standard’s

The World Bank is known to fund many infrastructure projects in developing countries, presumably as a means to achieve their goals of increasing development in those countries. Hydroelectric dams are some of the much-maligned infrastructure projects funded by the World Bank. In a report authored by employees of the World Bank itself, the authors themselves highlight the “adverse environmental and related social impacts” of large dams, while attempting to draw a distinction between “relatively good dams and bad dams”. (Ledec & Quintero, 2003)

There are many examples of IMF projects that resulted in failure in recent years. Brazil, Argentina, Turkey, Korea, and Indonesia are just a few examples, and now we can add Greece to the list. The IMF invested in Greece in 2010 and in 2013, the IMF openly recognized that they misjudged the effect austerity would have on the Greek economy (Elliot, L., Inman, P., & Smith, H., 2013). They issued a report that identified 'Notable failures ' that include "failure in restoring market confidence, the banks’ 30 percent loss in deposits, high unemployment, waiting too long to restructure the nation’s debt, and a deepening of the recession" (IMF recognizes 'notable failures ' in Greek bailout, 2013).

Since then, the IMF’s power and influence as an organisation increased even more after the collapsed of the global monetary rules it was assigned to oversee (Bretton Woods System). In February 1973, when the United States and the world abandoned the short-lived Smithsonian agreement, the entire attempt made to maintain the Bretton Woods fixed exchange rate system collapsed. The world returned to market-determined free exchange rates, the very system the IMF was established to

The Bretton Woods Conference in 1944 spawned two IFIs, the International Monetary Fund (IMF) and the World Bank, in order to rebuild a

Here the International Monetary Fund and the International Bank for Reconstruction and Development, later divided into the World Bank and Bank for International Settlement, were established. To regulate the international policy economy these institutions become known as the Bretton Woods institutions and became operational in 1946. The IMF, founded to stabilize countries' currencies in relation to each other, holds money in trust, which member countries can borrow according to terms set by the institution. The World Bank instead gives more long-term loans and sells bonds to corporations and governments, which bind the issuer to pay the bondholder the amount of the loan plus interest. However, the countries taking advantage of the opportunity to borrow money to improve their affected economy are obliged to launch a set of policies, known as the Washington Consensus, which was first presented in 1989. The reforms introduced by the Institute for International Economics include "deregulation, privatization, currency devaluation, social spending cuts, lower corporate taxes, export driven strategies, and removal of foreign investment restrictions" . More, "these loans are only granted when the countries agree to the adoption to a comprehensive programme of macro-economic stabilization and structural economic reform."

The Bretton Woods Institutions were than set up. It was also decided that the International Monetary Fund (IMF) would mainly focus on short-term balance-of-payments financing (the current account of the balance of payments), while the International Bank for Reconstruction and Development (World Bank) would concentrate on long-term lending (the capital account).

Financial institutions are the intermediaries that connect savers with borrowers, providing these parties with access to the financial markets (Cecchetti, 2015, p. 64). In their role as financial intermediaries, the functions these institutions are responsible for help the US economy operate more efficiently. They reduce both transaction and information costs within the financial system by standardizing loan products and borrower screening processes. These institutions also minimize risk for savers by pooling their resources and lending the pooled funds to many borrowers. Doing so meets the needs of savers, who can access their funds when they need them, and borrowers, who can utilize borrowed funds on the terms that best meet their needs

The global financial system is one of the most complicated entities ever created in all of human history. This utter complexity is the cause of the continual and long term downfall of this system that is happening to this day. The majority of the population has no idea how any part of this system works and this ignorance has allowed those in power to use the flaws in the system to their advantage, all at the expense of others. Those in control are stealing from the prosperity of the future to gain benefit for themselves in the present. This utter abuse needs to be stopped before the system, and its utter reliance on a very fine balance of factors, collapses and is forever lost. These acts of abuse and neglect are allowed to happen every

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

1.The international financial institutions (IFIs) are central pillars and the architects of the global economy. The world bank and IMF were founded and funded by the United states after the second world war to build shattered world economy after the war and great depression of the 1930s (socialist alternative,). The creation of the IFIs was to bring about a global economy after the “isolation economy” which some argue brought about the Second World War. The IFIs were to help the economy of the less developing countries (LDCs) to bring about growth and development, a phenomenon known as globalization.

The International Monetary Fund—also known as the “IMF” or the “Fund”—was conceived at a United Nations conference convened in Bretton Woods, New Hampshire, U.S. in July 1944. The 45 governments represented at that conference sought to build a framework for economic cooperation that would avoid a repetition of the disastrous economic policies that had contributed to the Great Depression of the 1930s.

After the World War II, the United States led the European countries to establish the World Bank (IBRD), which helped the reconstruction of Europe. And in the meanwhile, the United States led Japan, China and some other Asian countries to establish the Asian Development Bank (ADB) for the reconstruction of Asia after the war. IBRD, ADB and IMF (International Monetary Fund), etc. occupy the monopolistic and predominant status all around the world for several decades. In the other words, they dedicate the economic and the political tendency all over the world. However, there are many problems and unreasonable terms for the debit and credit, investment, financing and so on, which are related to the political reasons, exist in IBRD, ADB and IMF. These restricts influence the development of those Third World countries severely. Along with some other reasons and details, in October 2013, China put forward suggestions to establish Asian Infrastructure Investment Bank (AIIB), a multilateral development organization with 100 billion authorized capital, which supports the infrastructure development for Asian countries especially, and the headquarter is set up in Beijing, China. This initiative bring huge competitions among the United States, China and Japan. After October 2014, the competitions spread and expand, in which some European countries are involved as well. The establishment of AIIB is not only the economic development and breakthrough, but also related to the political

The IMF (The International Monetary Fund) with the World Bank, were established in July 1944 at the Bretton Woods conference as International Financial Institutions. “to Prevent economic crises and to rebuild economies shattered by World war II” The Levin-Institute(n.d). The IMF as an IFIs, was “aimed at stabilizing global financial markets and national currencies by providing resources to establish secure monetary policy and exchange rate regimes.”The Levin-Institute(n.d)