Question

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2. Prepare a minimum 3 double-spaced page report on International Monetary Fund.

What is International Monetary Fund's mission? What does it do? How does it go about achieving its mission? What does its organizational structure look like? etc.

Answer 1

Report on International Monetary Fund

The International Monetary Fund was established in 1945 and at present comprises 189 member countries that cooperate on world’s monetary matters for being financial stable, for creation of employment opportunities, for conducting global trade on better terms and eradication of global poverty.

The main objective of this organization is to secure global monetary stability particularly in terms of prevailing currency exchange methods for receiving and paying by different nations for their transactions. It executes it by monitoring the economic and financial events happening in member nations, loans financial resources to nations facing difficulties in their BOP and give financial consultancy to them.

The IMF discharges many functions.

• It is engaged deeply in scrutinizing financial and economic health of member nations. It supervises global monetary system. It identifies the stakes of member nation and gives consultancy to tide it over.
• Through its lending activities, it helps the nations to overcome balance of payments deficits and facilitate in their reserves building. It also assists in their payments for its international purchases and helps them until they regain full stability.
• It provides training facilities for member nations. They can send their delegates for training that eventually lead to betterment of quality of nation’s policy and help them in jobs.

The dedicated team of IMF working in its 17 departments helps it operate to perform the abovementioned tasks. It is headed by Managing director whose tenure is five years that can be renewed. He gets appointed by the 24 member executive board. Under him work four deputy directors. They advise him on vast matters.

The governing Board give guidelines for formulation of policies. The members of governing board are governors of central bank or finance ministers of member nations who meet once in a year. The Financial Committee of IMF is convened two times in a year. They evaluate the systems of IMF and render suggestions for its improvement. The voting power of member nations is according to their financial power globally. The policies are very relevant and transparent for all countries.

IMF has workforce diversity i.e. its people are from multi-nation and multicultural. They report to IMF. They work in functional, informational, networking and support facilities areas.

The countries do payment for their quota, which is determined on the basis of their financial ranking globally that forms the financial resources of IMF. IMF also borrows funds to help member nations. IMF had formed a global reserve asset called special drawing rights. It helps in member nations in their international reserves. IMF ranks top in holding gold reserves.

IMF is also dedicated to human and social cause and its “Giving Together campaign” governs its endeavors in regards to community work.