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INTRODUCTION
to
IMF
Maryam Mobin
What is the IMF?
• The intergovernmental
organization that oversees the
global financial system.
• IMF organizes the condu...
• An international monetary
conference was held at Bretton
Woods in U.S.A. in July which
lead to:
Establishment of I. M. ...
The International Monetary Fund
was created in July 1944, originally
with 45 members, with a goal to
stabilize exchange ra...
Members
of
IMF
188 Members of IMF
Types of Membership
Original membership:
• All those countries whose representatives
took part in Bretton Woods conference...
• Agree to the code of conduct found in
the IMF Articles of Agreement
• Pay a quota subscription
• Refrain from restrictio...
Resources
of
IMF
• When a country joins IMF, it is assigned
a quota which determines its maximum
contribution to the IMF’s financial
resour...
• IMF has signed a number of bilateral loan and note
purchase agreements to supplement its quota
resources.
• It maintains...
• The IMF’s gold holdings amount to
about 90.5 million troy ounces
(2,814.1 metric tons), making the IMF one
of the larges...
• The IMF currently provides two primary types of
financial assistance to low-income countries:
 Low-interest loans under...
Functions of
IMF
Tehseen Khalid
Three Major Functions of IMF
1. Surveillance
• Gathering the data and gives
advices in making policies of the
country.
2.Technical Assistant
• Strengthening the human skills and
institutional skills of the country.
3.Financial Assistant
• Le...
• The IMF also plays an important
role in the fight against Money
Laundering and Terrorism
Structure of
IMF
Structure of IMF
• IMF is Governed by FOUR main Bodies:
1: Governing Body
2: Executive Board
3: Managing Director
4: IMF S...
1. The Governing Body
• All powers of the IMF are Vested in its
Board of Governors, all the members of
countries are repre...
• December 2002, the United States
governor was Secretary of the Treasury
Paul O'Neill,and the alternate, Federal
Board Ch...
Voting Power
• Each member nation is required to
contribute funds according to its
Economic size and Strength
 Special Drawing Rights(SDR)
• A unit for the amount of foreign
currency member states can draw on
Currencies including:
...
Advisers of the GB
• It is being advised by TWO Committees:
I. International Monetary & Financial
Committee (IMFC)
II. Th...
International Monetary &
Financial Committee (IMFC)
• IMFC has 24 Members
• Meets twice a year (Spring , Annual)
• Matters...
The Development Committee
• 24 Members
• A joint committee, tasked with advising
• IMF & World Bank
• Issues related to Ec...
2. Executive Board
• 24 Executive Directors
• 5 are appointed by the countries having
Largest Quotas
• US, UK, Japan, Germ...
3. IMF Managing Directors
• Headed by Executive Board
• Managing Director is chosen by E.B
• It is responsible for the con...
4. IMF Staff
• It has staff of about 2,600 economists,
statisticians, research scholars, experts
in public finance and tax...
Importance
of
IMF
Sibgha Saleem
The importance of IMF can be
explained for its following works :
To bring about international
monetary cooperation.
To promote and establish system of
multinational trade and payments
system.
To help member nations to achieve
balanced e...
To ensure stability in foreign
exchange rates.
To reduce the disequilibrium in the
balance of payments.
To offer specia...
Strengths
of
imf
IMF can be seen as lender of last resort.
The IMF can provide crucial loans to stabilize
the economy and prevent a colla...
• IMF can impose necessary reforms on an
economy such as privatization, fiscal
responsibility etc.
• These policies may ca...
It provides an external assessment
of the economy, which helps the
government to implement popular
ideas while focusing on...
The IMF assists member nations in
several different capacities.
 If a country has a balance of payments
deficit, the IMF...
The World Bank.
The regional development banks.
The World Trade Organization.
United Nations agencies.
International ...
• It serves as a council and adviser to
countries attempting a new economic
policy.
• It is also known for providing a for...
Weaknesses
of
IMF
Abeer Fatima
1/6/2016
Template copyright 2005
www.brainybetty.com
46
• IMF implies same inflexible set of economic
policies for all its members regardless of the
situation
• For example, Poli...
• Loans with high interest rates
• Country stays in debt unable to provide for its
people ~ Poverty and Unemployment
• As voting power is determined by the amount
of money that each country pays into the
IMF's quota system
• Dominated by t...
Hinder Social Security and Social
Development
• Structural adjustment policies (SAPs)
• Cut social development budgets like
education, health, food and transportation
b...
1/6/2016
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www.brainybetty.com
55
1/6/2016
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• Foreign bodies have great
influence over key
economic issues and
resource management
and investments in IMF
debt countri...
1/6/2016
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www.brainybetty.com
59
Promote
Gender Discrimination at
National Level
IMF policies hurt WOMEN the most in
IMF debt countries by following
means:
• Difficult to meet families' basic needs
• Fir...
1/6/2016
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www.brainybetty.com
61
Violate Labor Rights
• The IMF advises countries to
attract foreign investors by
weakening their labor laws
• For example, In Haiti, the
govern...
1/6/2016
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www.brainybetty.com
63
1/6/2016
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www.brainybetty.com
64
• IMF policies promote natural resource exploitation and
Unsustainable liquidation on a staggering scale
• Environmental m...
Many member countries of IMF like
Italy and Greece, have been accused
of unsustainable budgets and unplanned
investments e...
CONCLUSION
IMF
IMF
IMF
IMF
IMF
IMF
IMF
IMF
IMF
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IMF

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IMF and How it Effects the INTERNATIONAL RELATIONS or the states

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IMF

  1. 1. INTRODUCTION to IMF Maryam Mobin
  2. 2. What is the IMF? • The intergovernmental organization that oversees the global financial system. • IMF organizes the conduct of international monetary affairs.
  3. 3. • An international monetary conference was held at Bretton Woods in U.S.A. in July which lead to: Establishment of I. M. F. Setting up of World Bank History of IMF
  4. 4. The International Monetary Fund was created in July 1944, originally with 45 members, with a goal to stabilize exchange rates and assist the reconstruction of the world international payment system.
  5. 5. Members of IMF
  6. 6. 188 Members of IMF
  7. 7. Types of Membership Original membership: • All those countries whose representatives took part in Bretton Woods conference • Who agreed to be the members of the fund prior to 31st December,1945. Ordinary membership: • All those who became its members subsequently. • BANK has the authority to suspend any member and similarly every member is free to resign.
  8. 8. • Agree to the code of conduct found in the IMF Articles of Agreement • Pay a quota subscription • Refrain from restrictions on exchange of foreign currency • Strive for openness in economic policies affecting other countries.
  9. 9. Resources of IMF
  10. 10. • When a country joins IMF, it is assigned a quota which determines its maximum contribution to the IMF’s financial resources. • It based on the country's relative size in the world economy, its voting power and drawing rights.
  11. 11. • IMF has signed a number of bilateral loan and note purchase agreements to supplement its quota resources. • It maintains two standing multilateral borrowing arrangements: The expanded New Arrangements to Borrow (NAB) The General Arrangements to Borrow (GAB)
  12. 12. • The IMF’s gold holdings amount to about 90.5 million troy ounces (2,814.1 metric tons), making the IMF one of the largest official holders of gold in the world. • The IMF’s Articles of Agreement strictly limit the use of gold. Gold holdings
  13. 13. • The IMF currently provides two primary types of financial assistance to low-income countries:  Low-interest loans under the Poverty Reduction and Growth Trust (PRGT)  Debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative and the Catastrophe Containment and Relief (CCR) Trust.
  14. 14. Functions of IMF Tehseen Khalid
  15. 15. Three Major Functions of IMF 1. Surveillance • Gathering the data and gives advices in making policies of the country.
  16. 16. 2.Technical Assistant • Strengthening the human skills and institutional skills of the country. 3.Financial Assistant • Lending to countries to support reforms
  17. 17. • The IMF also plays an important role in the fight against Money Laundering and Terrorism
  18. 18. Structure of IMF
  19. 19. Structure of IMF • IMF is Governed by FOUR main Bodies: 1: Governing Body 2: Executive Board 3: Managing Director 4: IMF Staff
  20. 20. 1. The Governing Body • All powers of the IMF are Vested in its Board of Governors, all the members of countries are represented.(187) • Ministry of finance or President of central bank • Governor and Alternate Governor • Meet once in a year in Washington DC
  21. 21. • December 2002, the United States governor was Secretary of the Treasury Paul O'Neill,and the alternate, Federal Board Ch. Alan Greenspan.
  22. 22. Voting Power • Each member nation is required to contribute funds according to its Economic size and Strength
  23. 23.  Special Drawing Rights(SDR) • A unit for the amount of foreign currency member states can draw on Currencies including: • Euro, Pound Sterling, Japanese yen and US Dollar
  24. 24. Advisers of the GB • It is being advised by TWO Committees: I. International Monetary & Financial Committee (IMFC) II. The Development Committee
  25. 25. International Monetary & Financial Committee (IMFC) • IMFC has 24 Members • Meets twice a year (Spring , Annual) • Matters of common concern affecting the global economy • Communiqués provide guidance for the IMF's work program
  26. 26. The Development Committee • 24 Members • A joint committee, tasked with advising • IMF & World Bank • Issues related to Economic development • Developmental issues
  27. 27. 2. Executive Board • 24 Executive Directors • 5 are appointed by the countries having Largest Quotas • US, UK, Japan, Germany, France • 19 are appointed by Regional Groups of remaining members • Fund General Operation • Function in Continuous Session
  28. 28. 3. IMF Managing Directors • Headed by Executive Board • Managing Director is chosen by E.B • It is responsible for the conduct of the ordinary business of the Fund • Manager appointed for 5-Years • May not serve concurrently
  29. 29. 4. IMF Staff • It has staff of about 2,600 economists, statisticians, research scholars, experts in public finance and taxation and in finance systems and banking, linguists, writers and editors, and support personnel. • Most headquartered in Washington, DC.
  30. 30. Importance of IMF Sibgha Saleem
  31. 31. The importance of IMF can be explained for its following works : To bring about international monetary cooperation.
  32. 32. To promote and establish system of multinational trade and payments system. To help member nations to achieve balanced economic growth.
  33. 33. To ensure stability in foreign exchange rates. To reduce the disequilibrium in the balance of payments. To offer special aids or loans to member countries in solving their economic problem.
  34. 34. Strengths of imf
  35. 35. IMF can be seen as lender of last resort. The IMF can provide crucial loans to stabilize the economy and prevent a collapse of confidence. Its most important function is its ability to provide loans to member nations in need of a bailout. Stabi lize Economy at the time of Need
  36. 36. • IMF can impose necessary reforms on an economy such as privatization, fiscal responsibility etc. • These policies may cause short term pain but are essential for preventing future crisis and long term development . IMF guarantees long term development
  37. 37. It provides an external assessment of the economy, which helps the government to implement popular ideas while focusing on its core macroeconomic and financial areas of responsibility. IMF Provides an External Aid
  38. 38. The IMF assists member nations in several different capacities.  If a country has a balance of payments deficit, the IMF can step in to fill the gap. IMF fills the gap to balance payments
  39. 39. The World Bank. The regional development banks. The World Trade Organization. United Nations agencies. International bodies. IMF Collaboration with Institutions
  40. 40. • It serves as a council and adviser to countries attempting a new economic policy. • It is also known for providing a forum for discussion and consultation among member countries. IMF as an Economic Adviser
  41. 41. Weaknesses of IMF Abeer Fatima
  42. 42. 1/6/2016 Template copyright 2005 www.brainybetty.com 46
  43. 43. • IMF implies same inflexible set of economic policies for all its members regardless of the situation • For example, Policies of privatization may work better in developed countries in the West but are more difficult to implement in the developing world
  44. 44. • Loans with high interest rates • Country stays in debt unable to provide for its people ~ Poverty and Unemployment
  45. 45. • As voting power is determined by the amount of money that each country pays into the IMF's quota system • Dominated by the perspective of the G8 industrialized nations • The U.S. is the largest shareholder of IMF. Germany, Japan, France, Great Britain, and the US combined control about 38 percent of shares.
  46. 46. Hinder Social Security and Social Development
  47. 47. • Structural adjustment policies (SAPs) • Cut social development budgets like education, health, food and transportation budgets etc. • Make exports cheaper • Privatize national assets • Cut down wages of employees
  48. 48. 1/6/2016 Template copyright 2005 www.brainybetty.com 55
  49. 49. 1/6/2016 Template copyright 2005 www.brainybetty.com
  50. 50. • Foreign bodies have great influence over key economic issues and resource management and investments in IMF debt countries. • For example, Jamaica argues that the IMF takes away the ability for countries to decide national policy.
  51. 51. 1/6/2016 Template copyright 2005 www.brainybetty.com 59 Promote Gender Discrimination at National Level
  52. 52. IMF policies hurt WOMEN the most in IMF debt countries by following means: • Difficult to meet families' basic needs • First to be drawn out of schools due to high education fee as suggested by SAPs • More exploited as sweatshops abuses increase with long working hours, less wages and non-existent facilities
  53. 53. 1/6/2016 Template copyright 2005 www.brainybetty.com 61 Violate Labor Rights
  54. 54. • The IMF advises countries to attract foreign investors by weakening their labor laws • For example, In Haiti, the government was told to eliminate a statute in their labor code that allowed increases in the minimum wage on 10% inflation. • Workers in rich countries are also hurt this.
  55. 55. 1/6/2016 Template copyright 2005 www.brainybetty.com 63
  56. 56. 1/6/2016 Template copyright 2005 www.brainybetty.com 64
  57. 57. • IMF policies promote natural resource exploitation and Unsustainable liquidation on a staggering scale • Environmental ministries are not included in policy making • For example, in Africa the Ivory Coast's increased reliance on cocoa exports has led to a loss of two- thirds of the country's forests
  58. 58. Many member countries of IMF like Italy and Greece, have been accused of unsustainable budgets and unplanned investments etc. because they believed that IMF would come to their rescue 66
  59. 59. CONCLUSION

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