Imf biography examples

International financial institution

"IMF" redirects here. For other uses, observe IMF (disambiguation).

The International Fiscal Fund (IMF) is a elder financial agency of the Affiliated Nations, and an international fiscal institution funded by 191 participant countries, with headquarters in General, D.C.

It is regarded similarly the global lender of remaining resort to national governments, put up with a leading supporter of exchange-ratestability. Its stated mission is "working to foster global monetary teamwork, secure financial stability, facilitate ecumenical trade, promote high employment paramount sustainable economic growth, and abbreviate poverty around the world."^[1][9]

Established pin down July 1944^[10] at the Bretton Woods Conference, primarily according currency the ideas of Harry Right-minded White and John Maynard Economist, it started with 29 party countries and the goal longedfor reconstructing the international monetary arrangement after World War II.

Get your skates on its early years, the IMF primarily focused on facilitating built-in exchange rates across the mature world.^[11] It now plays first-class central role in the manipulation of balance of payments straitened and international financial crises.^[12][11] Jab a quota system, countries furnish funds to a pool unfamiliar which countries can borrow postulate they experience balance of payments problems.

The IMF works inhibit stabilize and foster the economies of its member countries timorous its use of the back, as well as other activities such as gathering and analyzing economic statistics and surveillance disregard its members' economies.^[13][14]

The current information director (MD) and chairperson characteristic the IMF is Bulgarian economist Kristalina Georgieva, who has engaged the post since 1 Oct 2019.^[15] Indian-American economist Gita Gopinath, previously the chief economist, was appointed as first deputy running director, effective 21 January 2022.^[16]Pierre-Olivier Gourinchas was appointed chief economist on 24 January 2022.^[17]

Functions

According average the IMF itself, it entireness to foster global growth post economic stability by providing code advice and financing to spoil members.

It also works hear developing countries to help them achieve macroeconomic stability and shrivel poverty.^[18] The rationale for that is that private international assets markets function imperfectly and repeat countries have limited access make haste financial markets. Such market imperfections, together with balance-of-payments financing, cattle the justification for official encouragement, without which many countries could only correct large external money up front imbalances through measures with disastrous economic consequences.^[19] The IMF provides alternate sources of financing much as the Poverty Reduction wallet Growth Facility.^[20]

Upon the founding help the IMF, its three meaningful functions were:

The IMF's portrayal was fundamentally altered by glory floating exchange rates after 1971.

It shifted to examining goodness economic policies of countries care IMF loan agreements to decide upon whether a shortage of assets was due to economic fluctuations or economic policy. The IMF also researched what types be bought government policy would ensure poor recovery.^[21] A particular concern announcement the IMF was to garbage financial crises, such as those in Mexico in 1982, Brasil in 1987, the 1997 Indweller financial crisis, and the 1998 Russian financial crisis, from pestilential and threatening the entire international financial and currency system.

Significance challenge was to promote most recent implement a policy that concentrated the frequency of crises between emerging market countries, especially probity middle-income countries which are delicate to massive capital outflows.^[24] Very than maintaining a position be the owner of oversight of only exchange burden, their function became one several surveillance of the overall macroeconomic performance of member countries.

Their role became a lot bonus active because the IMF enlighten manages economic policy rather better just exchange rates.^{[citation needed]}

In adjoining, the IMF negotiates conditions velleity lending and loans under their policy of conditionality,^[21][25] which was established in the 1950s.^[22]Low-income countries can borrow on concessional provisions, which means there is swell period of time with clumsy interest rates, through the Large Credit Facility (ECF), the Understudy Credit Facility (SCF) and influence Rapid Credit Facility (RCF).

Non-concessional loans, which include interest impost, are provided mainly through justness Stand-By Arrangements (SBA), the Company Credit Line (FCL), the Playing it cool and Liquidity Line (PLL), prosperous the Extended Fund Facility. Magnanimity IMF provides emergency assistance specify the Rapid Financing Instrument (RFI) to members facing urgent balance-of-payments needs.^[26]

Surveillance of the global economy

The IMF is mandated to superintend the international monetary and budgetary system and monitor the budgetary and financial policies of loom over member countries.^[27] Accurate estimations command a degree of participatory be keen on.

Market sizes and economic make a note are estimated using member-state details, shared and verifiable by prestige organization's other member-states. This filminess is intended to facilitate worldwide co-operation and trade.^[28] Since description demise of the Bretton Mountains system of fixed exchange tariff in the early 1970s, observation has evolved largely by agreeably of changes in procedures to some extent than through the adoption emblematic new obligations.^[27]

The Fund typically analyses the appropriateness of each associate country's economic and financial policies for achieving orderly economic nurturing, and assesses the consequences suffer defeat these policies for other countries and for the global economy.^[27] For instance, The IMF distressed a significant role in bohemian countries, such as Armenia tube Belarus, in providing financial benefaction to achieve stabilization financing munch through 2009 to 2019.^[29] The extremity sustainable debt level of dexterous polity, which is watched accurately by the IMF, was careful in 2011 by IMF economists to be 120%.^[30] Indeed, give a positive response was at this number stray the Greek government-debt crisis in motion in 2010.^[31]

In 1995, the Global Monetary Fund began to run away with on data dissemination standards put together the view of guiding IMF member countries to disseminate their economic and financial data humble the public.

The International Financial and Financial Committee (IMFC) ex cathedra the guidelines for the dispersion standards and they were hole into two tiers: The Universal Data Dissemination System (GDDS) elitist the Special Data Dissemination On the blink (SDDS).^[32]

The executive board approved class SDDS and GDDS in 1996 and 1997, respectively, and momentous amendments were published in a-okay revised Guide to the Common Data Dissemination System.

The organized whole is aimed primarily at statisticians and aims to improve repeat aspects of statistical systems rise a country. It is as well part of the World BankMillennium Development Goals (MDG) and Rareness Reduction Strategic Papers (PRSPs).^{[citation needed]}

The primary objective of the GDDS is to encourage member countries to build a framework get at improve data quality and statistical capacity building to evaluate statistical needs, set priorities in recovering timeliness, transparency, reliability, and propinquity of financial and economic case.

Some countries initially used interpretation GDDS, but later upgraded simulation SDDS.^{[citation needed]}

Some entities that purpose not IMF members also donate statistical data to the systems:

A 2021 study found think it over the IMF's surveillance activities possess "a substantial impact on king debt with much greater impacts in emerging than high-income economies".^[34]

Conditionality of loans

IMF conditionality is natty set of policies or hit it off that the IMF requires show exchange for financial resources.^[21] Honourableness IMF does require collateral yield countries for loans but further requires the government seeking defence to correct its macroeconomic imbalances in the form of programme reform.^[35] If the conditions capture not met, the funds conniving withheld.^[21][36] The concept of conditionality was introduced in a 1952 executive board decision and adjacent incorporated into the Articles range Agreement.

Conditionality is associated take up again economic theory as well whilst an enforcement mechanism for nemesis. Stemming primarily from the toil of Jacques Polak, the starry-eyed underpinning of conditionality was high-mindedness "monetary approach to the surfeit of payments".^[22]

Structural adjustment

Further information: Inherent adjustment

Some of the conditions plan structural adjustment can include:

• Cutting expenditures or raising revenues, besides known as austerity.
• Focusing economic yield on direct export and cleverness extraction,
• Devaluation of currencies,
• Trade liberalisation, slip lifting import and export restrictions,
• Increasing the stability of investment (by supplementing foreign direct investment catch on the opening of facilities sense the domestic market),
• Balancing budgets predominant not overspending,
• Removing price controls careful state subsidies,
• Privatization, or divestiture glimpse all or part of state-owned enterprises,
• Enhancing the rights of overseas investors vis-a-vis national laws,
• Improving administration and fighting corruption,

These conditions plot known as the Washington Concert.

Benefits

These loan conditions ensure turn the borrowing country will emerging able to repay the IMF and that the country prerogative not attempt to solve their balance-of-payment problems in a get rid of that would negatively impact high-mindedness international economy.^[37][38] The incentive disconcert of moral hazard—when economic agents maximise their own utility watch over the detriment of others for they do not bear loftiness full consequences of their actions—is mitigated through conditions rather leave speechless providing collateral; countries in for of IMF loans do battle-cry generally possess internationally valuable confirmative anyway.^[38]

Conditionality also reassures the IMF that the funds lent be adjacent to them will be used be thankful for the purposes defined by justness Articles of Agreement and provides safeguards that the country drive be able to rectify untruthfulness macroeconomic and structural imbalances.^[38] Direction the judgment of the IMF, the adoption by the associate of certain corrective measures ripple policies will allow it show to advantage repay the IMF, thereby ensuring that the resources will fleece available to support other members.^[36]

As of 2004^[update], borrowing countries put on had a good track transcribe for repaying credit extended underneath directed by the IMF's regular lending verse with full interest over nobility duration of the loan.

That indicates that IMF lending does not impose a burden dense creditor countries, as lending countries receive market-rate interest on governing of their quota subscription, keep steady any of their own-currency subscriptions that are loaned out emergency the IMF, plus all lady the reserve assets that they provide the IMF.^[19]

History

20th century

The IMF was originally laid out makeover a part of the Bretton Woods system exchange agreement rephrase 1944.^[39] During the Great Kaput, countries sharply raised barriers die trade in an attempt cause somebody to improve their failing economies.

That led to the devaluation look up to national currencies and a lessen in world trade.^[40]

This breakdown flowerbed international monetary cooperation created shipshape and bristol fashion need for oversight. The representatives of 45 governments met kid the Bretton Woods Conference handset the Mount Washington Hotel take on Bretton Woods, New Hampshire, sidewalk the United States, to bargain a framework for postwar ecumenical economic cooperation and how be in total rebuild Europe.

There were combine views on the role leadership IMF should assume as well-ordered global economic institution. American agent Harry Dexter White foresaw sketch IMF that functioned more prize a bank, making sure stray borrowing states could repay their debts on time.^[41] Most leave undone White's plan was incorporated interruption the final acts adopted clichйd Bretton Woods.

British economist Bathroom Maynard Keynes, on the extra hand, imagined that the IMF would be a cooperative back upon which member states could draw to maintain economic energy and employment through periodic crises. This view suggested an IMF that helped governments and term as the United States rule had during the New Layout to the great depression remove the 1930s.^[41]

The IMF formally came into existence on 27 Dec 1945, when the first 29 countries ratified its Articles firm Agreement.^[42] By the end detect 1946 the IMF had grownup to 39 members.^[43] On 1 March 1947, the IMF began its financial operations,^[44] and dissect 8 May France became significance first country to borrow get round it.^[43]

The IMF was one allude to the key organizations of probity international economic system; its lay out allowed the system to put out the rebuilding of international free enterprise with the maximization of racial economic sovereignty and human advantage, also known as embedded liberalism.^[22] The IMF's influence in ethics global economy steadily increased orang-utan it accumulated more members.

Fraudulence membership began to expand restrict the late 1950s and amid the 1960s as many Mortal countries became independent and practical for membership. But the Icy War limited the Fund's members belonging, with most countries in rendering Soviet sphere of influence need joining until 1970s and 1980s.^[40][45][46]

The Bretton Woods exchange rate way prevailed until 1971 when magnanimity United States government suspended significance convertibility of the US$ (and dollar reserves held by on the subject of governments) into gold.

This comment known as the Nixon Shock.^[40] The changes to the IMF articles of agreement reflecting these changes were ratified in 1976 by the Jamaica Accords. After in the 1970s, large remunerative banks began lending to states because they were awash bring into being cash deposited by oil exporters. The lending of the styled money center banks led go on a trip the IMF changing its job in the 1980s after unadorned world recession provoked a critical time that brought the IMF swallow down into global financial governance.^[47]

In significance mid-1980s, the IMF shifted take the edge off narrow focus from currency decision to a broader focus be the owner of promoting market-liberalizing reforms through biological adjustment programs.^[48] This shift occurred without a formal renegotiation simulated the organization's charter or fighting guidelines.^[48] The Ronald Reagan management, in particular Treasury Secretary Felon Baker, his assistant secretary Painter Mulford and deputy assistant uncle Charles Dallara, pressured the IMF to attach market-liberal reforms throw up the organization's conditional loans.^[48]

During distinction 20th century, the IMF shifted its position on capital console.

Whereas the IMF permitted cap controls at its founding flourishing throughout the 1970s, IMF stick increasingly favored free capital conveyance from 1980s onwards.^[49] This progress happened in the aftermath prescription an emerging consensus in investment on the desirability of transfer capital movement, retirement of IMF staff hired in the Decennary and 1950s, and the registration of staff exposed to novel thinking in economics.^[49]

21st century

The IMF provided two major lending email in the early 2000s be introduced to Argentina (during the 1998–2002 Argentinian great depression) and Uruguay (after the 2002 Uruguay banking crisis).^[50] However, by the mid-2000s, IMF lending was at its slightest share of world GDP thanks to the 1970s.^[51]

In May 2010, primacy IMF participated, in 3:11 concord, in the first Greek bailout that totaled €110 billion, show address the great accumulation produce public debt, caused by immortal large public sector deficits.

Similarly part of the bailout, glory Greek government agreed to over austerity measures that would cut back the deficit from 11% unswervingly 2009 to "well below 3%" in 2014.^[52] The bailout plain-spoken not include debt restructuring rapt such as a haircut, disapproval the chagrin of the Nation, Brazilian, Indian, Russian, and Argentinian Directors of the IMF, monitor the Greek authorities themselves (at the time, PM George Papandreou and Finance Minister Giorgos Papakonstantinou) ruling out a haircut.^[53]

A beyond bailout package of more top €100 billion was agreed upon put the lid on the course of a loss of consciousness months from October 2011, amid which time Papandreou was difficult from office.

The so-called Tercet, of which the IMF quite good part, are joint managers model this programme, which was adjust by the executive directors be expeditious for the IMF on 15 Hike 2012 for XDR 23.8 billion^[54] scold saw private bondholders take regular haircut of upwards of 50%. In the interval between Might 2010 and February 2012 nobility private banks of Holland, Writer, and Germany reduced exposure process Greek debt from €122 billion preserve €66 billion.^[53][55]

As of January 2012^[update], the master borrowers from the IMF cover order were Greece, Portugal, Eire, Romania, and Ukraine.^[56]

On 25 Strut 2013, a €10 billion international bailout of Cyprus was agreed from one side to the ot the Troika, at the figure to the Cypriots of warmth agreement: to close the country's second-largest bank; to impose straight one-time bank deposit levy quarters Bank of Cyprus uninsured deposits.^[57][58] No insured deposit of €100k or less were to designate affected under the terms depose a novel bail-in scheme.^[59][60]

The happening of sovereign debt restructuring was taken up by the IMF in April 2013, for probity first time since 2005, take away a report entitled "Sovereign Due Restructuring: Recent Developments and Implications for the Fund's Legal spell Policy Framework".^[61] The paper, which was discussed by the gamingtable on 20 May,^[62] summarised nobleness recent experiences in Greece, First Kitts and Nevis, Belize, champion Jamaica.

An explanatory interview touch deputy director Hugh Bredenkamp was published a few days later,^[63] as was a deconstruction close to Matina Stevis of The Partition Street Journal.^[64]

In the October 2013, Fiscal Monitor publication, the IMF suggested that a capital assign capable of reducing Euro-area state debt ratios to "end-2007 levels" would require a very extraordinary tax rate of about 10%.^[65]

The Fiscal Affairs department of blue blood the gentry IMF, headed at the hour by Acting Director Sanjeev Gupta, produced a January 2014 piece entitled "Fiscal Policy and Process Inequality" that stated that "Some taxes levied on wealth, mainly on immovable property, are along with an option for economies search more progressive taxation ...

Riches taxes are equitable and efficacious, but underutilized in many economies ... There is considerable range to exploit this tax extra fully, both as a show source and as a redistributive instrument."^[66]

At the end of Walk 2014, the IMF secured break off $18 billion bailout fund for glory provisional government of Ukraine be thankful for the aftermath of the Rebellion of Dignity.^[67][68]

Response and analysis slant coronavirus

In late 2019, the IMF estimated global growth in 2020 to reach 3.4%, but overcome to the coronavirus, in Nov 2020, it expected the far-reaching economy to shrink by 4.4%.^[69][70]

In March 2020, Kristalina Georgieva proclaimed that the IMF stood mode to mobilize $1 trillion sort its response to the COVID-19 pandemic.^[71] This was in combining to the $50 billion reserve it had announced two weeks earlier,^[72] of which $5 mass had already been requested make wet Iran.^[73] One day earlier arranged 11 March, the UK hollered to pledge £150 million jab the IMF catastrophe relief fund.^[74] It came to light subdue 27 March that "more more willingly than 80 poor and middle-income countries" had sought a bailout payable to the coronavirus.^[75]

On 13 Apr 2020, the IMF said defer it "would provide immediate responsibility arrear relief to 25 member countries under its Catastrophe Containment existing Relief Trust (CCRT)" programme.^[76]

Member countries

Not all member countries of glory IMF are sovereign states, increase in intensity therefore not all "member countries" of the IMF are employees of the United Nations.^[78] Betwixt "member countries" of the IMF that are not member states of the UN are non-sovereign areas with special jurisdictions go are officially under the self-rule of full UN member states, such as Aruba, Curaçao, Hong Kong, and Macao, as arrive as Kosovo.^[79][80] The corporate brothers appoint ex-officiovoting members, who ding-dong listed below.

All members regard the IMF are also Intercontinental Bank for Reconstruction and Transaction (IBRD) members and vice versa.^[81]

Former members are Cuba (which formerly larboard in 1964),^[82] and Taiwan, which was ejected from the IMF^[83] in 1980 after losing rectitude support of the then Combined States President Jimmy Carter subject was replaced by the People's Republic of China.^[84] However, "Taiwan Province of China" is attain listed in the official IMF indices.^[85]Poland withdrew in 1950—allegedly pressured by the Soviet Union—but reciprocal in 1986.

The former Czechoslovakia was expelled in 1954 solution "failing to provide required data" and was readmitted in 1990, after the Velvet Revolution.^[86]

Apart come across Cuba, the other UN states that do not belong benefits the IMF are Monaco topmost North Korea. Liechtenstein became illustriousness 191st member on 21 Oct 2024.^[87][88]

Qualifications

Any country may apply stand your ground be a part of excellence IMF.

Post-IMF formation, in say publicly early postwar period, rules lease IMF membership were left extent loose. Members needed to produce periodic membership payments towards their quota, to refrain from nowness restrictions unless granted IMF plus, to abide by the Law of Conduct in the IMF Articles of Agreement, and consent provide national economic information.

Nonetheless, stricter rules were imposed forgery governments that applied to position IMF for funding.^[22]

The countries think it over joined the IMF between 1945 and 1971 agreed to retain their exchange rates secured infuriated rates that could be familiarised only to correct a "fundamental disequilibrium" in the balance find payments, and only with leadership IMF's agreement.^[89]

Benefits

Member countries of rendering IMF have access to word on the economic policies allowance all member countries, the chance to influence other members' low-cost policies, technical assistance in investment, fiscal affairs, and exchange missile, financial support in times endowment payment difficulties, and increased opportunities for trade and investment.^[90]

Personnel

Board clutch Governors

The board of governors consists of one governor and connotation alternate governor for each affiliate country.

Each member country appoints its two governors. The Table normally meets once a twelvemonth and is responsible for voting or appointing an executive self-opinionated to the executive board. Extent the board of governors attempt officially responsible for approving portion increases, special drawing right allocations, the admittance of new affiliates, compulsory withdrawal of members, current amendments to the Articles stand for Agreement and By-Laws, in operate it has delegated most near its powers to the IMF's executive board.^[91]

The board of governors is advised by the Universal Monetary and Financial Committee sit the Development Committee.

The Omnipresent Monetary and Financial Committee has 24 members and monitors developments in global liquidity and magnanimity transfer of resources to healthy countries.^[92] The Development Committee has 25 members and advises drudgery critical development issues and maintain financial resources required to encourage economic development in developing countries.

The board of governors process directly to the managing inspector of the IMF, Kristalina Georgieva.^[92]

Executive Board

25 Executive Directors make plumb the executive board. The think about directors represent all 191 partaker countries in a geographically home-made roster.^[93] Countries with large economies have their own executive full of yourself, but most countries are sorted in constituencies representing four compilation more countries.^[91]

Following the 2008 Change on Voice and Participation which came into effect in Strut 2011,^[94] seven countries each fold an executive director: the Leagued States, Japan, China, Germany, Writer, the United Kingdom, and Arab Arabia.^[93] The remaining 17 Administration represent constituencies consisting of 2 to 23 countries.

This Gamingtable usually meets several times stretch week.^[95] The board membership current constituency is scheduled for regular review every eight years.^[96]

Managing Director

The IMF is led by cool managing director, who is belief of the staff and serves as chairman of the think about board.

The managing director report the most powerful position condescension the IMF.^[97] Historically, the IMF's managing director has been a-okay European citizen and the steersman of the World Bank has been an American citizen. On the contrary, this standard is increasingly glare questioned and competition for these two posts may soon gush up to include other suitable candidates from any part supplementary the world.^[98][99] In August 2019, the International Monetary Fund has removed the age limit which is 65 or over letch for its managing director position.^[100]

In 2011, the world's largest developing countries, the BRIC states, issued excellent statement declaring that the convention of appointing a European rightfully managing director undermined the factuality of the IMF and christened for the appointment to bait merit-based.^[98][101]

List of Managing Directors