Running head: IMF

IMF
IMF is an international Monetary Fund, that was established in 1944, at Bretton Woods
Conference. But officially it was created in 1945, by 29 countries. The reason for initiation was
the post-world war II economic condition in the world.
IMF works for fostering global growth and economic stability. Its membership is
supported by contribution of:
a) Policy advice for governments and central banks in developing countries, or countries
with economic difficulties.
b) Situated on the markets and economies, that are global, regional or individual,
carrying out researches, statistics, projections and analysis.
c) Credits which help states to overcome the economic obstacles
d) Compromising loans to reduce poverty rates
e) In order to develop the governance of countrys economy, providing an access to new
technologies and trainings.
As I already mentioned, organizations main goal is to ensure that international
monetary, in addition with financial system is balanced. For reaching the goal, it
owns three tools to carry out the mandate: surveillance, lending and technical
assistance and training. These functions are underpinned by the IMFs research and
statistics. (How We Do it)

Surveillance it is the name for process of carrying out a monitory, involving

discussion about particular countrys economic and financial policies, also
known as bilateral surveillance. Usually, conducted estimations of member
states economic condition happens annually. Organization also has different

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extensive analysis of global and regional trends in eceonomics, and it is called

multilateral surveillance.
International Monetary Fund has offered to countries technical assistance and
training in order to help them maintain and strengthen the capacity for
designing and implementing more efficient policies. This aids are offered in
certain areas, starting from fiscal and monetary & exchange rate policies,

ending up with banking and finances, followed by statistics & regulations.

For correcting payment problems and for correct economic balancing, IMF
provides financial support to its member countries. Internal improvements and
development in the organization caused the ability to IMF, to provide flexible
crisis prevention tools in large scales, appended to policies, sound fundaments

and specific frameworks.

As a support to all the activities listed above, IMF has economic and financial
research and statistics. IMF is continuing working on its improvements and
strengthening its global financial system, for later benefits (resolving
economic crisis).

Nowadays there are 188 member countries in IMF. In order to gain a membership,
country has to apply and the application will be accepted in case, if majority of members vote in
favor. In April, 2012, the last country entered in IMF was South Sudan, which became 188th
member. Before entering organization, country has to assign its quota. Quota member countrys
quota determines its maximum financial commitment to the IMF, its voting power, and has a
bearing on its access to IMF financing. Quota is describing the relationship between IMF and the
country, which includes:

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Subscription around 25 % has to be paid by the country in the IMFs currency, which is
like dollar, euro, yen or pound, or so-called Special Drawing Rights (value is based on four key
international currencies) and rest should be paid in the national currency of the country.
Voting Power it totally depends on the quota. IMF votes stand for each country in the
following way: basic votes, plus additional vote for each 100 000 SDR quota. Basic votes stand
from 5.502 % of total votes.
Access to Financing it is also depended on the quota of country. In the special codec for
loans, it is written that country can take around 200 % of what it quota is annually, and by
aggregative means 600.
International Monetary Fund has many interconnections with the world organizations that
are involved in global economic market. Among them one of the most important is World Bank.
Even though they are different and contribute to different missions, they complement each other.
World bank is worrying more about financial infrastructure and specific spheres in economy.
While IMF, tries to stabilize currencies and rebuild the conditions for improved growth in
economics. There is a close relationship between United Nations and International Monetary
Fund. They share mutual areas of interest, which includes cooperating for taxation problems and
statistical services, not speaking about regular participation at meetings and conferences. In
recent years, the IMF has worked with the International Labor Office on issues related to
employment, as well as social protection floors; the UN Children's Fund on fiscal issues and
social policy; the UN Environment Program on the green economy; and the World Food Program
on social safety nets and early assessments of vulnerability. (Collaboration Between Eachother).
Another collaborator for IMF is Group of Twenty, which presents industrialized market
economies. Monetary Fund is carrying out researches on global economic conditions, as well as

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how Group Twenty members policies are working simultaneously, and if the goal is achievable.
Also, organization is involved in close relations with academic communities, civil society
organizations or CSOs and the global media.
The IMF is led by a Managing Director, who is head of the staff and Chairman of the
Executive Board. The Managing Director is assisted by a First Deputy Managing Director and
three other Deputy Managing Directors. According to the IMF's Articles of Agreement, the
Managing Director "shall be chief of the operating staff of the Fund and shall conduct, under the
direction of the Executive Board, the ordinary business of the Fund. Subject to the general
control of the Executive Board, he shall be responsible for the organization, appointment, and
dismissal of the staff of the Fund."
(Managament)

Bibliography
Collaboration Between Eachother. (n.d.). Retrieved from International Monetary Fund :
http://www.imf.org/external/about/collab.htm#imf_wb
How We Do it. (n.d.). Retrieved from International Monetary Fund:
http://www.imf.org/external/about/howwedo.htm
Managament. (n.d.). Retrieved from International Monetary Fund:
http://www.imf.org/external/about/mgmt.htm