What Role Does the Imf Play in the World Economy? What Are the Main Costs and Benefits of Imf Adjustment Policies?

Argentina is a well known case study of the failure or negative outcome of some IMF's standard policies. In fact, Argentina carefully applied policies dictated by IMF, but, until it stuck up with those policies, it couldn't step out from its crisis, and it ran into even deeper economic and social problems. This failure of the IMF has often been cited as the demonstration of unsuitability of the standard IMF approach (the usual so-called Washington Consensus) for solving economic crisis in developing countries (Serra & Stiglitz, 2008, p. 44). Also, this failure led to hostile feelings versus IMF among the population of Argentina (Kanenguiser, 2000) and fueled generalised suspects over IMF decision-making process being politicized and serving

Defined by the International Monetary Fund as "the increasing integration of economies around the world, particularly through the movement of

Definition: Organization of 188 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.

The International Monetary Fund (IMF) was created in the mid-1940s as a direct result of the chaos created by the individual central banks before and during the Great Depression. With the advent of economic globalization, it became clear that the uncoordinated policies of individual central banks was becoming a hindrance to global growth and financial stability. In December 1944, the IMF formally came into existence with 29 members, each agreeing to cooperate on the international stage to stabilize exchange rates and

One of the purposes for the creation of the World Bank and the IMF was to ensure that financial markets throughout the world are stable, which would be beneficial to the global economy and possibly prevent a global economic depression. However, there are not always positive outcomes for local economies of the countries that are part of these International Financial Institutions (IFI). Haiti was one of these countries that was impacted by the guidelines set in place by these institutions.

All three countries actively follow the guidelines of these major international institutions. According to Managing Director of the IMF (Kohler, 2002), “There has been a near-revolution in transparency at the IMF, and a steady improvement in the release of economic information by our member countries.” It is essential for countries to be transparent in their annual checkups from the IMF in order to keep all member countries up to date on economic data in countries they have financial dealings with. This information is what keeps countries from financial crisis. The United States is the largest shareholder of the World Bank and is the only country with veto power over changes in structure, therefore the US plays a major role in developing and supporting the World Bank’s mission (The World Bank, 2013). Since 1998, France has only been a respondent to 4 dispute cases (World Trade Organization), which shows that they actively try to follow the guidelines.

The IMF is an international organization of 185 member countries. It was established to promote international monetary cooperation, exchange stability, and orderly exchange arrangements; to foster economic growth and high levels of employment; and to provide temporary financial assistance to countries to help ease balance of payments adjustments.

participants in this conference created three organizations to help regulate the international economy. The first is the International Monetary Fund (IMF) which was established with the idea of regulating monetary policy. One of the benchmarks of the IMF is the stabilization of exchange rates and the loaning of money to help stabilize countries with balance of payments deficits. The second organization established was the General Agreement on Tariffs and Trade (GATT) whose main focus was on a liberal trading order.

The Bretton Woods Conference set out six goals for the IMF in its Articles of Agreement. Those goals, as shown:

In post-conflict countries, the process of disarmament, demobilization and reintegration following the end of direct-violence require the crucial step of economic revitalization and job creation. Intergovernmental agencies, such as the International Monetary Fund (IMF), assist the government to provide aid, support and international monetary stability. Post-conflict reconstruction of war-torn nations often relies on loans from the IMF, which are stipulated

The three major international economic institutions are the International Monetary Fund (IMF), the World Bank and the World Trade Organization; this book mainly focuses on the IMF and the World Bank, due to the author’s first-hand experience with both institutions. The IMF, a public institution built as a guiding hand for economic stability around the world, has brought false

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."

Total indebted areas were major in Developing countries or known as third world could be devided in three groups: Latin America, East Asian and Sub-Sahara

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.

International banks have made risky loans all over the world because they knew that if trouble arose, the fund would step in to resolve the situation – as it has done in the past. The IMF has played a critical role in many of the epochal events in the 1990’s. The IMF lent 18 billion dollars to Mexico in 1994, after the peso collapsed. It gave Russia over 10 billion dollars in 1999. The IMF has helped drive inflation from 1,000 percent a year down to a tolerable 10 percent a year, thanks to Russia listening to what the IMF said and doing as they suggested. It has given Indonesia 10 billion dollars, and has helped Indonesia demonopolize industries. It gave 4 billion to Thailand, which was the epicenter of the East Asian Crisis. The IMF helped closed dozens of reckless banks. True, the IMF did many little things wrong, however, it did the important ones right. The Philippines is a prime example on how effectively the IMF can work. For years, Filipinos suffered the weaknesses of economic and business policies. Under the tutelage of the International Monetary Fund for nearly 30 years, and especially during the past decade, they faced up to their problems. Many sectors of their society suffered greatly, and some complained loudly. However, they persisted and, with the help of the IMF and the courage of the Philippine people, they exited from the IMF program. How did they do this? They assembled one of the best economic