"WTO" redirects here. For other uses, see WTO (disambiguation).

World Trade Organization (English)

Organisation mondiale du commerce
(French)
Organización Mundial del Comercio
(Spanish)

WTO founder members (January 1, 1995)

WTO subsequent members
Formation January 1, 1995
Centre William Rappard,
Headquarters
Geneva, Switzerland
Membership 153 member states
Official languages English, French, Spanish[1]
Director-General Pascal Lamy
189 million Swiss francs (approx.
Budget
182 million USD) in 2009.[2]
Staff 625[3]
Website www.wto.org

The World Trade Organization (WTO) is an organization that intends to supervise and
liberalize international trade. The organization officially commenced on January 1, 1995
under the Marrakech Agreement, replacing the General Agreement on Tariffs and Trade
(GATT), which commenced in 1948. The organization deals with regulation of trade
between participating countries; it provides a framework for negotiating and formalizing
trade agreements, and a dispute resolution process aimed at enforcing participants'
adherence to WTO agreements which are signed by representatives of member
governments and ratified by their parliaments.[4][5] Most of the issues that the WTO
focuses on derive from previous trade negotiations, especially from the Uruguay Round
(1986–1994).

The organization is currently endeavoring to persist with a trade negotiation called the
Doha Development Agenda (or Doha Round), which was launched in 2001 to enhance
equitable participation of poorer countries which represent a majority of the world's
population. However, the negotiation has been dogged by "disagreement between
exporters of agricultural bulk commodities and countries with large numbers of
subsistence farmers on the precise terms of a 'special safeguard measure' to protect
farmers from surges in imports. At this time, the future of the Doha Round is
uncertain."[6]

The WTO has 153 members,[7] representing more than 97% of total world trade[8] and 30
observers, most seeking membership. The WTO is governed by a ministerial conference,
meeting every two years; a general council, which implements the conference's policy
decisions and is responsible for day-to-day administration; and a director-general, who is
appointed by the ministerial conference. The WTO's headquarters is at the Centre
William Rappard, Geneva, Switzerland.

Contents
[hide]

• 1 History
o 1.1 GATT rounds of negotiations
 1.1.1 From Genève to Tokyo
 1.1.2 Uruguay Round
o 1.2 Ministerial conferences
o 1.3 Doha Round
• 2 Functions
• 3 Principles of the trading system
• 4 Organizational structure
o 4.1 Voting system
• 5 Dispute settlement
• 6 Accession and membership
o 6.1 Accession process
o 6.2 Members and observers
• 7 Agreements
• 8 Effectiveness
• 9 Directors-General
• 10 See also
• 11 Notes
• 12 References
• 13 External links
o 13.1 Official WTO pages
o 13.2 Government pages on the WTO
o 13.3 Media pages on the WTO

o 13.4 Non-governmental organization pages on the WTO

History
See also: Timeline of the World Trade Organization and International Trade Organization
Harry White (l) and John Maynard Keynes at the Bretton Woods Conference — Both
economists had been strong advocates of a liberal international trade environment, and
recommended the establishment of three institutions: the IMF (fiscal and monetary
issues), the World Bank (financial and structural issues), and the ITO (international
economic cooperation).[9]

The WTO's predecessor, the General Agreement on Tariffs and Trade (GATT), was
established after World War II in the wake of other new multilateral institutions
dedicated to international economic cooperation — notably the Bretton Woods
institutions known as the World Bank and the International Monetary Fund. A
comparable international institution for trade, named the International Trade Organization
was successfully negotiated. The ITO was to be a United Nations specialized agency and
would address not only trade barriers but other issues indirectly related to trade, including
employment, investment, restrictive business practices, and commodity agreements. But
the ITO treaty was not approved by the U.S. and a few other signatories and never went
into effect.[10][11][12]

In the absence of an international organization for trade, the GATT would over the years
"transform itself" into a de facto international organization.[13]

GATT rounds of negotiations

See also: General Agreement on Tariffs and Trade

The GATT was the only multilateral instrument governing international trade from 1945
until the WTO was established in 1995.[14] Despite attempts in the mid 1950s and 1960s
to create some form of institutional mechanism for international trade, the GATT
continued to operate for almost half a century as a semi-institutionalized multilateral
treaty regime on a provisional basis.[15]

From Genève to Tokyo

Seven rounds of negotiations occurred under GATT. The first real GATT trade rounds
concentrated on further reducing tariffs. Then, the Kennedy Round in the mid-sixties
brought about a GATT anti-dumping Agreement and a section on development. The
Tokyo Round during the seventies was the first major attempt to tackle trade barriers that
do not take the form of tariffs, and to improve the system, adopting a series of agreements
on non-tariff barriers, which in some cases interpreted existing GATT rules, and in others
broke entirely new ground. Because these plurilateral agreements were not accepted by
the full GATT membership, they were often informally called "codes". Several of these
codes were amended in the Uruguay Round, and turned into multilateral commitments
accepted by all WTO members. Only four remained plurilateral (those on government
procurement, bovine meat, civil aircraft and dairy products), but in 1997 WTO members
agreed to terminate the bovine meat and dairy agreements, leaving only two.[14]

Uruguay Round

During the Doha Round, the US government blamed Brazil and India for being
inflexible, and the EU for impeding agricultural imports.[16] The President of Brazil, Luiz
Inácio Lula da Silva, responded to the criticisms by arguing that progress would only be
achieved if the richest countries (especially the US and countries in the EU) make deeper
cuts in their agricultural subsidies, and further open their markets for agricultural goods.
[17]

Main article: Uruguay Round

Well before GATT's 40th anniversary, its members concluded that the GATT system was
straining to adapt to a new globalizing world economy.[18][19] In response to the problems
identified in the 1982 Ministerial Declaration (structural deficiencies, spill-over impacts
of certain countries' policies on world trade GATT could not manage etc.), the eighth
GATT round — known as the Uruguay Round — was launched in September 1986, in
Punta del Este, Uruguay.[18]

It was the biggest negotiating mandate on trade ever agreed: the talks were going to
extend the trading system into several new areas, notably trade in services and intellectual
property, and to reform trade in the sensitive sectors of agriculture and textiles; all the
original GATT articles were up for review.[19] The Final Act concluding the Uruguay
Round and officially establishing the WTO regime was signed during the April 1994
ministerial meeting at Marrakesh, Morocco, and hence is known as the Marrakesh
Agreement.[20]
The GATT still exists as the WTO's umbrella treaty for trade in goods, updated as a result
of the Uruguay Round negotiations (a distinction is made between GATT 1994, the
updated parts of GATT, and GATT 1947, the original agreement which is still the heart of
GATT 1994).[18] GATT 1994 is not however the only legally binding agreement included
via the Final Act at Marrakesh; a long list of about 60 agreements, annexes, decisions and
understandings was adopted. The agreements fall into a structure with six main parts:

• The Agreement Establishing the WTO

• Goods and investment — the Multilateral Agreements on Trade in Goods
including the GATT 1994 and the Trade Related Investment Measures
• Services — the General Agreement on Trade in Services
• Intellectual property — the Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS)
• Dispute settlement (DSU)
• Reviews of governments' trade policies (TPRM)[21]

Ministerial conferences

The topmost decision-making body of the WTO is the Ministerial Conference, which
usually meets every two years. It brings together all members of the WTO, all of which
are countries or customs unions. The Ministerial Conference can take decisions on all
matters under any of the multilateral trade agreements. The inaugural ministerial
conference was held in Singapore in 1996. Disagreements between largely developed and
developing economies emerged during this conference over four issues initiated by this
conference, which led to them being collectively referred to as the "Singapore issues".
The second ministerial conference was held in Geneva in Switzerland. The third
conference in Seattle, Washington ended in failure, with massive demonstrations and
police and National Guard crowd control efforts drawing worldwide attention. The fourth
ministerial conference was held in Doha in the Persian Gulf nation of Qatar. The Doha
Development Round was launched at the conference. The conference also approved the
joining of China, which became the 143rd member to join. The fifth ministerial
conference was held in Cancún, Mexico, aiming at forging agreement on the Doha round.
An alliance of 22 southern states, the G20 developing nations (led by India, China,[22]
Brazil, ASEAN led by the Philippines), resisted demands from the North for agreements
on the so-called "Singapore issues" and called for an end to agricultural subsidies within
the EU and the US. The talks broke down without progress.

The sixth WTO ministerial conference was held in Hong Kong from 13–18 December
2005. It was considered vital if the four-year-old Doha Development Agenda negotiations
were to move forward sufficiently to conclude the round in 2006. In this meeting,
countries agreed to phase out all their agricultural export subsidies by the end of 2013,
and terminate any cotton export subsidies by the end of 2006. Further concessions to
developing countries included an agreement to introduce duty free, tariff free access for
goods from the Least Developed Countries, following the Everything but Arms initiative
of the European Union — but with up to 3% of tariff lines exempted. Other major issues
were left for further negotiation to be completed by the end of 2010. The WTO General
Council, on 26 May 2009, agreed to hold a seventh WTO ministerial conference session
in Geneva from 30 November-3 December 2009. A statement by chairman Amb. Mario
Matus acknowledged that the prime purpose was to remedy a breach of protocol
requiring two-yearly "regular" meetings, which had lapsed with the Doha Round failure
in 2005, and that the "scaled-down" meeting would not be a negotiating session, but
"emphasis will be on transparency and open discussion rather than on small group
processes and informal negotiating structures". The general theme for discussion was
"The WTO, the Multilateral Trading System and the Current Global Economic
Environment"[23]

Doha Round

Main article: Doha Round

The Doha Development Round started in 2001 and continues today.

The WTO launched the current round of negotiations, the Doha Development Agenda
(DDA) or Doha Round, at the fourth ministerial conference in Doha, Qatar in November
2001. The Doha round was to be an ambitious effort to make globalization more
inclusive and help the world's poor, particularly by slashing barriers and subsidies in
farming.[24] The initial agenda comprised both further trade liberalization and new rule-
making, underpinned by commitments to strengthen substantial assistance to developing
countries.[25]

The negotiations have been highly contentious and agreement has not been reached,
despite the intense negotiations at several ministerial conferences and at other sessions.
Disagreements still continue over several key areas including agriculture subsidies.[26]

[show]GATT and WTO trade rounds[27]v · d · e

Functions
Among the various functions of the WTO, these are regarded by analysts as the most
important:

• It oversees the implementation, administration and operation of the covered

agreements.[28][29]
 • It provides a forum for negotiations and for settling disputes.[30][31]

Additionally, it is the WTO's duty to review and propagate the national trade policies,
and to ensure the coherence and transparency of trade policies through surveillance in
global economic policy-making.[29][31] Another priority of the WTO is the assistance of
developing, least-developed and low-income countries in transition to adjust to WTO
rules and disciplines through technical cooperation and training.[32]

The WTO is also a center of economic research and analysis: regular assessments of the
global trade picture in its annual publications and research reports on specific topics are
produced by the organization.[33] Finally, the WTO cooperates closely with the two other
components of the Bretton Woods system, the IMF and the World Bank.[30]

Principles of the trading system

The WTO establishes a framework for trade policies; it does not define or specify
outcomes. That is, it is concerned with setting the rules of the trade policy games.[34] Five
principles are of particular importance in understanding both the pre-1994 GATT and the
WTO:

1. Non-Discrimination. It has two major components: the most favoured nation

(MFN) rule, and the national treatment policy. Both are embedded in the main
WTO rules on goods, services, and intellectual property, but their precise scope
and nature differ across these areas. The MFN rule requires that a WTO member
must apply the same conditions on all trade with other WTO members, i.e. a
WTO member has to grant the most favorable conditions under which it allows
trade in a certain product type to all other WTO members.[34] "Grant someone a
special favour and you have to do the same for all other WTO members."[35]
National treatment means that imported goods should be treated no less favorably
than domestically produced goods (at least after the foreign goods have entered
the market) and was introduced to tackle non-tariff barriers to trade (e.g. technical
standards, security standards et al. discriminating against imported goods).[34]
2. Reciprocity. It reflects both a desire to limit the scope of free-riding that may
arise because of the MFN rule, and a desire to obtain better access to foreign
markets. A related point is that for a nation to negotiate, it is necessary that the
gain from doing so be greater than the gain available from unilateral
liberalization; reciprocal concessions intend to ensure that such gains will
materialise.[36]
3. Binding and enforceable commitments. The tariff commitments made by WTO
members in a multilateral trade negotiation and on accession are enumerated in a
schedule (list) of concessions. These schedules establish "ceiling bindings": a
country can change its bindings, but only after negotiating with its trading
partners, which could mean compensating them for loss of trade. If satisfaction is
not obtained, the complaining country may invoke the WTO dispute settlement
procedures.[35][36]
 4. Transparency. The WTO members are required to publish their trade
regulations, to maintain institutions allowing for the review of administrative
decisions affecting trade, to respond to requests for information by other
members, and to notify changes in trade policies to the WTO. These internal
transparency requirements are supplemented and facilitated by periodic country-
specific reports (trade policy reviews) through the Trade Policy Review
Mechanism (TPRM).[37] The WTO system tries also to improve predictability and
stability, discouraging the use of quotas and other measures used to set limits on
quantities of imports.[35]
5. Safety valves. In specific circumstances, governments are able to restrict trade.
There are three types of provisions in this direction: articles allowing for the use
of trade measures to attain noneconomic objectives; articles aimed at ensuring
"fair competition"; and provisions permitting intervention in trade for economic
reasons.[37] Exceptions to the MFN principle also allow for preferential treatment
of developed countries, regional free trade areas and customs unions.[citation needed]

Organizational structure
The General Council has multiple bodies which oversee committees in different areas, re
the following:

Council for Trade in Goods

There are 11 committees under the jurisdiction of the Goods Council each with a
specific task. All members of the WTO participate in the committees. The
Textiles Monitoring Body is separate from the other committees but still under the
jurisdiction of Goods Council. The body has its own chairman and only 10
members. The body also has several groups relating to textiles.[38]
Council for Trade-Related Aspects of Intellectual Property Rights
Information on intellectual property in the WTO, news and official records of the
activities of the TRIPS Council, and details of the WTO’s work with other
international organizations in the field.[39]
Council for Trade in Services
The Council for Trade in Services operates under the guidance of the General
Council and is responsible for overseeing the functioning of the General
Agreement on Trade in Services (GATS). It is open to all WTO members, and can
create subsidiary bodies as required.[40]
Trade Negotiations Committee
The Trade Negotiations Committee (TNC) is the committee that deals with the
current trade talks round. The chair is WTO’s director-general. The committee is
currently tasked with the Doha Development Round.[41]

The Service Council has three subsidiary bodies: financial services, domestic regulations,
GATS rules and specific commitments.[38] The General council has several different
committees, working groups, and working parties.[42] There are committees on the
following: Trade and Environment; Trade and Development (Subcommittee on Least-
Developed Countries); Regional Trade Agreements; Balance of Payments Restrictions;
and Budget, Finance and Administration. There are working parties on the following:
Accession. There are working groups on the following: Trade, debt and finance; and
Trade and technology transfer.

Voting system

The WTO operates on a one country, one vote system, but actual votes have never been
taken. Decision making is generally by consensus, and relative market size is the primary
source of bargaining power. The advantage of consensus decision-making is that it
encourages efforts to find the most widely acceptable decision. Main disadvantages
include large time requirements and many rounds of negotiation to develop a consensus
decision, and the tendency for final agreements to use ambiguous language on
contentious points that makes future interpretation of treaties difficult.[citation needed]

In reality, WTO negotiations proceed not by consensus of all members, but by a process
of informal negotiations between small groups of countries. Such negotiations are often
called "Green Room" negotiations (after the colour of the WTO Director-General's Office
in Geneva), or "Mini-Ministerials", when they occur in other countries. These processes
have been regularly criticised by many of the WTO's developing country members which
are often totally excluded from the negotiations..[citation needed]

Richard Harold Steinberg (2002) argues that although the WTO's consensus governance
model provides law-based initial bargaining, trading rounds close through power-based
bargaining favouring Europe and the U.S., and may not lead to Pareto improvement.[43]

Dispute settlement
Main article: Dispute settlement in the WTO

In 1994, the WTO members agreed on the Understanding on Rules and Procedures
Governing the Settlement of Disputes (DSU) annexed to the "Final Act" signed in
Marrakesh in 1994.[44] Dispute settlement is regarded by the WTO as the central pillar of
the multilateral trading system, and as a "unique contribution to the stability of the global
economy".[45] WTO members have agreed that, if they believe fellow-members are
violating trade rules, they will use the multilateral system of settling disputes instead of
taking action unilaterally.[46]

The operation of the WTO dispute settlement process involves the DSB panels, the
Appellate Body, the WTO Secretariat, arbitrators, independent experts and several
specialized institutions.[47] Bodies involved in the dispute settlement process, World
Trade Organization.

Accession and membership

Main article: WTO accession and membership
The process of becoming a WTO member is unique to each applicant country, and the
terms of accession are dependent upon the country's stage of economic development and
current trade regime.[48] The process takes about five years, on average, but it can last
more if the country is less than fully committed to the process or if political issues
interfere.[49] As is typical of WTO procedures, an offer of accession is only given once
consensus is reached among interested parties.[50]

Accession process

Status of WTO negotiations:

members (including dual-representation with the European Union)
Draft Working Party Report or Factual Summary adopted
Goods and/or Services offers submitted
Memorandum on Foreign Trade Regime submitted
observer, negotiations to start later or no Memorandum on FTR submitted
frozen procedures or no negotiations in the last 3 years
no official interaction with the WTO

A country wishing to accede to the WTO submits an application to the General Council,
and has to describe all aspects of its trade and economic policies that have a bearing on
WTO agreements.[51] The application is submitted to the WTO in a memorandum which
is examined by a working party open to all interested WTO Members.[50]

After all necessary background information has been acquired, the working party focuses
on issues of discrepancy between the WTO rules and the applicant's international and
domestic trade policies and laws. The working party determines the terms and conditions
of entry into the WTO for the applicant nation, and may consider transitional periods to
allow countries some leeway in complying with the WTO rules.[48]

The final phase of accession involves bilateral negotiations between the applicant nation
and other working party members regarding the concessions and commitments on tariff
levels and market access for goods and services. The new member's commitments are to
apply equally to all WTO members under normal non-discrimination rules, even though
they are negotiated bilaterally.[51]
When the bilateral talks conclude, the working party sends to the general council or
ministerial conference an accession package, which includes a summary of all the
working party meetings, the Protocol of Accession (a draft membership treaty), and lists
("schedules") of the member-to-be's commitments. Once the general council or
ministerial conference approves of the terms of accession, the applicant's parliament must
ratify the Protocol of Accession before it can become a member.[52]

Members and observers

The WTO has 153 members (almost all of the 123 nations participating in the Uruguay
Round signed on at its foundation, and the rest had to get membership).[53] The 27 states
of the European Union are represented also as the European Communities. WTO
members do not have to be full sovereign nation-members. Instead, they must be a
customs territory with full autonomy in the conduct of their external commercial
relations. Thus Hong Kong (as "Hong Kong, China" since 1997) became a GATT
contracting party, and the Republic of China (ROC) (commonly known as Taiwan, whose
sovereignty has been disputed by the People's Republic of China or PRC) acceded to the
WTO in 2002 under the name of "Separate Customs Territory of Taiwan, Penghu,
Kinmen and Matsu" (Chinese Taipei).[54]

A number of non-members (30) are observers at WTO proceedings and are currently
negotiating their membership. As observers, Iran, Iraq and Russia are not yet members.
Russia is the biggest economy outside WTO and after the completion of Russia's
accession, Iran would be the biggest economy outside the WTO.[55] With the exception of
the Holy See, observers must start accession negotiations within five years of becoming
observers. Some international intergovernmental organizations are also granted observer
status to WTO bodies.[56] 14 states and 2 territories so far have no official interaction with
the WTO.

Agreements
Main article: Uruguay Round

The WTO oversees about 60 different agreements which have the status of international
legal texts. Member countries must sign and ratify all WTO agreements on accession.[57]
A discussion of some of the most important agreements follows. The Agreement on
Agriculture came into effect with the establishment of the WTO at the beginning of 1995.
The AoA has three central concepts, or "pillars": domestic support, market access and
export subsidies. The General Agreement on Trade in Services was created to extend the
multilateral trading system to service sector, in the same way the General Agreement on
Tariffs and Trade (GATT) provides such a system for merchandise trade. The Agreement
entered into force in January 1995. The Agreement on Trade-Related Aspects of
Intellectual Property Rights sets down minimum standards for many forms of intellectual
property (IP) regulation. It was negotiated at the end of the Uruguay Round of the
General Agreement on Tariffs and Trade (GATT) in 1994.
The Agreement on the Application of Sanitary and Phytosanitary Measures — also
known as the SPS Agreement was negotiated during the Uruguay Round of the General
Agreement on Tariffs and Trade, and entered into force with the establishment of the
WTO at the beginning of 1995. Under the SPS agreement, the WTO sets constraints on
members' policies relating to food safety (bacterial contaminants, pesticides, inspection
and labelling) as well as animal and plant health (imported pests and diseases). The
Agreement on Technical Barriers to Trade is an international treaty of the World Trade
Organization. It was negotiated during the Uruguay Round of the General Agreement on
Tariffs and Trade, and entered into force with the establishment of the WTO at the end of
1994. The object ensures that technical negotiations and standards, as well as testing and
certification procedures, do not create unnecessary obstacles to trade".[58] The Agreement
on Customs Valuation, formally known as the Agreement on Implementation of Article
VII of GATT, prescribes methods of customs valuation that Members are to follow.
Chiefly, it adopts the "transaction value" approach.

The International Monetary Fund (IMF) is the intergovernmental organization that

oversees the global financial system by following the macroeconomic policies of its
member countries, in particular those with an impact on exchange rate and the balance of
payments. It is an organization formed with a stated objective of stabilizing international
exchange rates and facilitating development through the enforcement of liberalising
economic policies[1][2] on other countries as a condition for loans, restructuring or aid.[3] It
also offers loans with varying levels of conditionality, mainly to poorer countries. Its
headquarters are in Washington, D.C., United States. The IMF's relatively high influence
in world affairs and development has drawn heavy criticism from some sources.[4][5]

Contents
[hide]

• 1 Organization and purpose

o 1.1 Membership
• 2 History
• 3 Data dissemination systems
• 4 Member states
o 4.1 Membership qualifications
o 4.2 Members' quotas and voting power, and board of governors
• 5 Assistance and reforms
• 6 Support of military dictatorships and governments perpetrating human rights
abuses
• 7 Criticism
o 7.1 Impact on access to food
o 7.2 Impact on public health
o 7.3 Impact on environment
o 7.4 Criticism from free-market advocates
• 8 Managing director
• 9 In the media
• 10 References
• 11 Further reading

• 12 External links

[edit] Organization and purpose

IMF "Headquarters 1" in Washington, D.C.

The International Monetary Fund was conceived in July 1944 originally with 45 members
and came into existence in December 1945 when 29 countries signed the agreement,[6]
with a goal to stabilize exchange rates and assist the reconstruction of the world's
international payment system. Countries contributed to a pool which could be borrowed
from, on a temporary basis, by countries with payment imbalances (Condon, 2007). The
IMF was important when it was first created because it helped the world stabilize the
economic system. The IMF works to improve the economies of its member countries.[7]
The IMF describes itself as "an organization of 187 countries (as of July 2010), working
to foster global monetary cooperation, secure financial stability, facilitate international
trade, promote high employment and sustainable economic growth, and reduce poverty".

[edit] Membership

IMF member states

IMF member states not accepting the obligations of Article VIII, Sections 2, 3, and 4[8]

Members of the IMF are 186 of the UN members and Kosovo.[9][10].

Former members are: Cuba (left in 1964),[11], Taiwan (expelled in 1980 due to political
reasons),[12]

The other non-members are: North Korea, Andorra, Monaco, Liechtenstein, Nauru, Cook
Islands, Niue, Vatican City and the rest of the states with limited recognition.

All member states participate directly in the IMF. Member states are represented on a 24-
member Executive Board (five Executive Directors are appointed by the five members
with the largest quotas, nineteen Executive Directors are elected by the remaining
members), and all members appoint a Governor to the IMF's Board of Governors.[13]

All members of the IMF are also IBRD members, and vice versa.

[edit] History
IMF "Headquarters 2" in Washington, D.C.

The International Monetary Fund was conceived in July 1944 during the United Nations
Monetary and Financial Conference. The representatives of 45 governments met in the
Mount Washington Hotel in the area of Bretton Woods, New Hampshire, United States,
with the delegates to the conference agreeing on a framework for international economic
cooperation.[14] The IMF was formally organized on December 27, 1945, when the first
29 countries signed its Articles of Agreement. The statutory purposes of the IMF today
are the same as when they were formulated in 1943 (see #Assistance and reforms).

The IMF's influence in the global economy steadily increased as it accumulated more
members. The number of IMF member countries has more than quadrupled from the 44
states involved in its establishment, reflecting in particular the attainment of political
independence by many developing countries and more recently the collapse of the Soviet
bloc. The expansion of the IMF's membership, together with the changes in the world
economy, have required the IMF to adapt in a variety of ways to continue serving its
purposes effectively.

In 2008, faced with a shortfall in revenue, the International Monetary Fund's executive
board agreed to sell part of the IMF's gold reserves. On April 27, 2008, IMF Managing
Director Dominique Strauss-Kahn welcomed the board's decision of April 7, 2008 to
propose a new framework for the fund, designed to close a projected $400 million budget
deficit over the next few years. The budget proposal includes sharp spending cuts of $100
million until 2011 that will include up to 380 staff dismissals.[15]

At the 2009 G-20 London summit, it was decided that the IMF would require additional
financial resources to meet prospective needs of its member countries during the ongoing
global financial crisis. As part of that decision, the G-20 leaders pledged to increase the
IMF's supplemental cash tenfold to $500 billion, and to allocate to member countries
another $250 billion via Special Drawing Rights.[16][17]

On October 23, 2010, the Ministers of Finance of G-20, governing most of the IMF
member quotas, agreed to reform IMF and shift about 6% of the voting shares to major
developing nations and countries with emerging markets.[18] As of August 2010 Romania
($13.9 billion), Ukraine ($12.66 billion), Hungary ($11.7 billion) and Greece ($30
billion) are the largest borrowers of the fund.[19]

[edit] Data dissemination systems

 This section does not cite any references or sources.
Please help improve this article by adding citations to reliable sources. Unsourced material may
be challenged and removed. (February 2011)

IMF Data Dissemination Systems participants:

IMF member using SDDS
IMF member, using GDDS
IMF member, not using any of the DDSystems
non-IMF entity using SDDS
non-IMF entity using GDDS
no interaction with the IMF

In 1995, the International Monetary Fund began work on data dissemination standards
with the view of guiding IMF member countries to disseminate their economic and
financial data to the public. The International Monetary and Financial Committee (IMFC)
endorsed the guidelines for the dissemination standards and they were split into two tiers:
The General Data Dissemination System (GDDS) and the Special Data Dissemination
Standard (SDDS).

The International Monetary Fund executive board approved the SDDS and GDDS in
1996 and 1997 respectively and subsequent amendments were published in a revised
"Guide to the General Data Dissemination System". The system is aimed primarily at
statisticians and aims to improve many aspects of statistical systems in a country. It is
also part of the World Bank Millennium Development Goals and Poverty Reduction
Strategic Papers.

The IMF established a system and standard to guide members in the dissemination to the
public of their economic and financial data. Currently there are two such systems:
General Data Dissemination System (GDDS) and its superset Special Data Dissemination
System (SDDS), for those member countries having or seeking access to international
capital markets.

The primary objective of the GDDS is to encourage IMF member countries to build a
framework to improve data quality and increase statistical capacity building. This will
involve the preparation of meta data describing current statistical collection practices and
setting improvement plans. Upon building a framework, a country can evaluate statistical
needs, set priorities in improving the timeliness, transparency, reliability and accessibility
of financial and economic data.

Some countries initially used the GDDS, but lately upgraded to SDDS.

Some entities that are not themselves IMF members also contribute statistical data to the
systems:

• Palestinian National Authority – GDDS

• Hong Kong – SDDS
• European Union institutions:
o the European Central Bank for the Eurozone – SDDS
o Eurostat for the whole EU – SDDS, thus providing data from Cyprus
(not using any DDSystem on its own) and Malta (using only GDDS
on its own)

[edit] Member states

[edit] Membership qualifications

The application will be considered first by the IMF's Executive Board. After its
consideration, the Executive Board will submit a report to the Board of Governors of the
IMF with recommendations in the form of a "Membership Resolution". These
recommendations cover the amount of quota in the IMF, the form of payment of the
subscription, and other customary terms and conditions of membership.[20] After the
Board of Governors has adopted the "Membership Resolution," the applicant state needs
to take the legal steps required under its own law to enable it to sign the IMF's Articles of
Agreement and to fulfill the obligations of IMF membership.

Similarly, any member country can withdraw from the Fund, although that is rare. For
example, in April 2007, the president of Ecuador, Rafael Correa announced the expulsion
of the World Bank representative in the country. A few days later, at the end of April,
Venezuelan president Hugo Chavez announced that the country would withdraw from the
IMF and the World Bank. Chavez dubbed both organizations as "the tools of the empire"
that "serve the interests of the North".[21] As of June 2009, both countries remain as
members of both organizations. Venezuela was forced to back down because a
withdrawal would have triggered default clauses in the country's sovereign bonds[citation
needed]
.

A member's quota in the IMF determines the amount of its subscription, its voting
weight, its access to IMF financing, and its allocation of Special Drawing Rights (SDRs).
A member state cannot unilaterally increase its quota—increases must be approved by the
Executive Board of IMF and are linked to formulas that include many variables such as
the size of a country in the world economy. For example, in 2001, the People's Republic
of China was prevented from increasing its quota as high as it wished, ensuring it
remained at the level of the smallest G7 economy (Canada).[22]
In September 2005, the IMF's member countries agreed to the first round of ad hoc quota
increases for four countries, including China[citation needed]. On March 28, 2008, the IMF's
Executive Board ended a period of extensive discussion and negotiation over a major
package of reforms to enhance the institution's governance that would shift quota and
voting shares from advanced to emerging markets and developing countries[citation needed].
Under existing arrangements, the industrialised countries(including Mexico) hold 57 per
cent of the IMF votes[citation needed]. But the financial crisis has tilted control away from
heavily indebted mature economies, such as the United States and the United Kingdom,
in favour of the fast-growing, cash-rich, so-called “BRIC” economies of Brazil, Russia,
India and China.[1]

Since the United States has by far the largest share of votes (approx. 17%) amongst IMF
members (see table below), it has little to lose relative to European nations. At the 2009
G-20 Pittsburgh summit, the US raised the possibility that some European countries
would reduce their votes in favour of increasing the votes for emerging economies.
However, both France and Britain were particularly reluctant as an increase in China's
votes would mean China now has more votes than the UK and France. At a subsequent
IMF meeting in Istanbul, the same month as the Pittsburgh Summit, IMF managing
director Dominique Strauss-Kahn then highlighted that "If we don't correct them, we'll
have the recipe for the next major crisis."[23] Citing the seriousness of the issue to be
tackled.

[edit] Members' quotas and voting power, and board of governors

Major decisions require an 85% supermajority.[24] The United States has always been the
only country able to block a supermajority on its own. The following table shows the top
20 member states in terms of voting power (2,220,817 votes in total). The 27 member
states of the European Union have a combined vote of 710,786 (32.07%).[25]

On October 23, 2010, the Ministers of Finance of G-20, governing most of the IMF
member quotas, agreed to reform IMF and shift about 6% of the voting shares to major
developing nations and countries with emerging markets.[18]

Members' quotas and voting power, and board of governors

Quota: Quota: Votes:
IMF member Alternate Votes:
millions percentage Governor percentage
country Governor number
of SDRs of total of total
United Timothy F. Ben
37,149.3 15.82 371,743 16.74
States Geithner Bernanke
Yoshihiko Masaaki
Japan 13,312.8 6.12 133,378 6.01
Noda Shirakawa
Axel A. Wolfgang
Germany 13,008.2 5.98 130,332 5.87
Weber Schäuble
United George Mervyn
10,738.5 4.94 107,635 4.85
Kingdom Osborne King
 Christine Christian
France 10,738.5 4.94 107,635 4.85
Lagarde Noyer
Zhou
China 8,090.1 4.42 Yi Gang 81,151 3.65
Xiaochuan
Giulio Mario
Italy 7,055.5 3.24 70,805 3.19
Tremonti Draghi
Saudi Ibrahim A. Hamad Al-
6,985.5 3.21 70,105 3.16
Arabia Al-Assaf Sayari
Jim Mark
Canada 6,369.2 2.93 63,942 2.88
Flaherty Carney
Aleksei Sergey
Russia 5,945.4 2.73 59,704 2.69
Kudrin Ignatyev
Netherlan Nout L.B.J. van
5,162.4 2.37 51,874 2.34
ds Wellink Geest
Guy Jean-Pierre
Belgium 4,605.2 2.12 46,302 2.08
Quaden Arnoldi
Pranab Duvvuri
India 4,158.2 2.91 41,832 1.88
Mukherjee Subbarao
Eveline
Switzerlan 3,458.5 Jean-Pierre
1.59 Widmer- 34,835 1.57
d Roth
Schlumpf
Wayne
Australia 3,236.4 1.49 Ken Henry 32,614 1.47
Swan
Agustín Guillermo
Mexico 3,152.8 1.45 31,778 1.43
Carstens Ortiz
Miguel
Elena
Spain 3,048.9 1.40 Fernández 30,739 1.38
Salgado
Ordóñez
Guido Henrique
Brazil 3,036.1 1.40 30,611 1.38
Mantega Meirelles
South Seong Tae
2,927.3 1.35 Okyu Kwon 29,523 1.33
Korea Lee
Gastón Rodrigo
Venezuel
2,659.1 1.22 Parra Cabeza 26,841 1.21
a
Luzardo Morales
remaining
62,593.8 28.79 respective respective 667,438 30.05
166 countries

[edit] Assistance and reforms

Main articles: Washington consensus and Structural adjustment program

The primary mission of the IMF is to provide financial assistance to countries that
experience serious financial and economic difficulties using funds deposited with the
IMF from the institution's 187 member countries. Member states with balance of
payments problems, which often arise from these difficulties, may request loans to help
fill gaps between what countries earn and/or are able to borrow from other official
lenders and what countries must spend to operate, including to cover the cost of
importing basic goods and services. In return, countries are usually required to launch
certain reforms, which have often been dubbed the "Washington Consensus". These
reforms are thought to be beneficial to countries with fixed exchange rate policies that
may engage in fiscal, monetary, and political practices which may lead to the crisis itself.
For example, nations with severe budget deficits, rampant inflation, strict price controls,
or significantly over-valued or under-valued currencies run the risk of facing balance of
payment crises. Thus, the structural adjustment programs are at least ostensibly intended
to ensure that the IMF is actually helping to prevent financial crises rather than merely
funding financial recklessness.

[edit] Support of military dictatorships and

governments perpetrating human rights abuses
The role of the Bretton Woods institutions has been controversial since the late Cold War
period, due to claims that the IMF policy makers supported military dictatorships friendly
to American and European corporations and other anti-communist regimes. Critics also
claim that the IMF is generally apathetic or hostile to their views of human rights, and
labor rights. The controversy has helped spark the Anti-globalization movement.
Arguments in favor of the IMF say that economic stability is a precursor to democracy;
however, critics highlight various examples in which democratized countries fell after
receiving IMF loans.[26]

In the 1960s, the IMF and the World Bank supported the government of Brazil’s military
dictator Castello Branco with tens of millions of dollars of loans and credit that were
denied to previous democratically elected governments.[27]

Countries that were or are under a military dictatorship or whose governments were
perpetrating human rights abuses whilst being members of the IMF/World Bank (support
from various sources in $Billion):[28]

[hide]Support of military dictatorships

Dictato
Count Dictato r
Country Debt % Debt %
In [clarification needed] ry r debts generat
indebted to at end of
Dictator powe debts generat ed
IMF/World at start of dictators
r in ed $ debt %
Bank dictatorship hip
1996 billion of total
debt
1976
Military
Argentina - 9.3 48.9 93.8 39.6 42%
dictatorship
1983
 1962
Military
Bolivia - 0 2.7 5.2 2.7 52%
dictatorship
1980
1964
Military
Brazil - 5.1 105.1 179 100 56%
dictatorship
1985
1973
Chile Augusto Pinochet - 5.2 18 27.4 12.8 47%
1989
1979
El Military
- 0.9 2.2 2.2 1.3 59%
Salvador dictatorship
1994
1977
Mengistu Haile
Ethiopia - 0.5 4.2 10 3.7 37%
Mariam
1991
1971
Jean-Claude
Haiti - 0 0.7 0.9 0.7 78%
Duvalier
1986
1967
Indonesia Suharto - 3 129 129 126 98%
1998
1979
Kenya Daniel arap Moi - 2.7 6.9 6.9 4.2 61%
2002
1979
Liberia Doe - 0.6 1.9 2.1 1.3 62%
1990
1964
Malawi Banda - 0.1 2 2.3 1.9 83%
1994
1984
Buhari/Babangida/
Nigeria - 17.8 31.4 31.4 13.6 43%
Abacha
1998
1977
Pakistan Zia-ul Haq - 7.6 17
1988
1999
Pakistan Pervez Musharraf - 20 26
2008
1954
Paraguay Stroessner - 0.1 2.4 2.1 2.3 96%
1989
1965
Philippin
Marcos - 1.5 28.3 41.2 26.8 65%
es
1986
 1969
Somalia Siad Barre - 0 2.4 2.6 2.4 92%
1991
1948
South
Apartheid - 18.7 23.6 18.7 79%
Africa
1992
1969
-
Sudan Nimeiry/al-Mahdi 0.3 17 17 16.7 98%
prese
nt
1950
Military
Thailand - 0 13.9 90.8 13.9 15%
dictatorship
1983
Zaire/De
1965
mocratic
Mobutu - 0.3 12.8 12.8 12.5 98%
Republic of
1997
the Congo

Notes: Debt at takeover by dictatorship; earliest data published by the World Bank is for
1970. Debt at end of dictatorship (or 1996, most recent date for World Bank data).

[edit] Criticism
Two criticisms from economists have been that financial aid is always bound to so-called
"Conditionalities", including Structural Adjustment Programs (SAP). It is claimed that
conditionalities (economic performance targets established as a precondition for IMF
loans) retard social stability and hence inhibit the stated goals of the IMF, while
Structural Adjustment Programs lead to an increase in poverty in recipient countries.[29]

The IMF sometimes advocates "austerity programmes," increasing taxes even when the
economy is weak, in order to generate government revenue and bring budgets closer to a
balance, thus reducing budget deficits. Countries are often advised to lower their
corporate tax rate. These policies were criticized by Joseph E. Stiglitz, former chief
economist and Senior Vice President at the World Bank, in his book Globalization and
Its Discontents.[30] He argued that by converting to a more Monetarist approach, the fund
no longer had a valid purpose, as it was designed to provide funds for countries to carry
out Keynesian reflations, and that the IMF "was not participating in a conspiracy, but it
was reflecting the interests and ideology of the Western financial community".[31]

Argentina, which had been considered by the IMF to be a model country in its
compliance to policy proposals by the Bretton Woods institutions, experienced a
catastrophic economic crisis in 2001,[32] which some believe to have been caused by IMF-
induced budget restrictions — which undercut the government's ability to sustain national
infrastructure even in crucial areas such as health, education, and security — and
privatization of strategically vital national resources.[33] Others attribute the crisis to
Argentina's misdesigned fiscal federalism, which caused subnational spending to increase
rapidly.[34] The crisis added to widespread hatred of this institution in Argentina and other
South American countries, with many blaming the IMF for the region's economic
problems.[35] The current — as of early 2006 — trend towards moderate left-wing
governments in the region and a growing concern with the development of a regional
economic policy largely independent of big business pressures has been ascribed to this
crisis.

Another example of where IMF Structural Adjustment Programmes aggravated the

problem was in Kenya. Before the IMF got involved in the country, the Kenyan central
bank oversaw all currency movements in and out of the country. The IMF mandated that
the Kenyan central bank had to allow easier currency movement. However, the
adjustment resulted in very little foreign investment, but allowed Kamlesh Manusuklal
Damji Pattni, with the help of corrupt government officials, to siphon off billions of
Kenyan shillings in what came to be known as the Goldenberg scandal, leaving the
country worse off than it was before the IMF reforms were implemented.[citation needed] In an
interview, the former Romanian Prime Minister Tăriceanu stated that "Since 2005, IMF
is constantly making mistakes when it appreciates the country's economic performances".
[36]

Overall, the IMF success record is perceived as limited.[citation needed] While it was created to
help stabilize the global economy, since 1980 critics claim over 100 countries (or
reputedly most of the Fund's membership) have experienced a banking collapse that they
claim have reduced GDP by four percent or more, far more than at any time in Post-
Depression history.[citation needed] The considerable delay in the IMF's response to any crisis,
and the fact that it tends to only respond to them (or even create them)[37] rather than
prevent them, has led many economists to argue for reform. In 2006, an IMF reform
agenda called the Medium Term Strategy was widely endorsed by the institution's
member countries. The agenda includes changes in IMF governance to enhance the role
of developing countries in the institution's decision-making process and steps to deepen
the effectiveness of its core mandate, which is known as economic surveillance or
helping member countries adopt macroeconomic policies that will sustain global growth
and reduce poverty. On June 15, 2007, the Executive Board of the IMF adopted the 2007
Decision on Bilateral Surveillance, a landmark measure that replaced a 30-year-old
decision of the Fund's member countries on how the IMF should analyse economic
outcomes at the country level.

[edit] Impact on access to food

A number of civil society organizations[38] have criticized the IMF's policies for their
impact on people's access to food, particularly in developing countries. In October 2008,
former US President Bill Clinton joined this chorus in a speech to the United Nations
World Food Day, which criticized the World Bank and IMF for their policies on food and
agriculture:
We need the World Bank, the IMF, all the big foundations, and all the governments to
admit that, for 30 years, we all blew it, including me when I was President. We were
wrong to believe that food was like some other product in international trade, and we all
have to go back to a more responsible and sustainable form of agriculture.
—Former US President Bill Clinton, Speech at United Nations World Food Day,
October 16, 2008[39]

[edit] Impact on public health

In 2008, a study by analysts from Cambridge and Yale universities published on the
open-access Public Library of Science concluded that strict conditions on the
international loans by the IMF resulted in thousands of deaths in Eastern Europe by
tuberculosis as public health care had to be weakened. In the 21 countries to which the
IMF had given loans, tuberculosis deaths rose by 16.6%.[40]

In 2009, a book by Rick Rowden titled, The Deadly Ideas of Neoliberalism: How the
IMF has Undermined Public Health and the Fight Against Aids, claimed that the IMF's
monetarist approach towards prioritizing price stability (low inflation) and fiscal restraint
(low budget deficits) was unnecessarily restrictive and has prevented developing
countries from being able to scale up long-term public investment as a percent of GDP in
the underlying public health infrastructure. The book claimed the consequences have
been chronically underfunded public health systems, leading to dilapidated health
infrastructure, inadequate numbers of health personnel, and demoralizing working
conditions that have fueled the "push factors" driving the brain drain of nurses migrating
from poor countries to rich ones, all of which has undermined public health systems and
the fight against HIV/AIDS in developing countries.[41]

[edit] Impact on environment

IMF policies have been repeatedly criticized for making it difficult for indebted countries
to avoid ecosystem-damaging projects that generate cash flow, in particular oil, coal and
forest-destroying lumber and agriculture projects. Ecuador for example had to defy IMF
advice repeatedly in order to pursue the protection of its rain forests, though
paradoxically this need was cited in IMF argument to support that country. The IMF
acknowledged this paradox in a March 2010 staff position report [42] which proposed the
IMF Green Fund, a mechanism to issue Special Drawing Rights directly to pay for
climate harm prevention and potentially other ecological protection as pursued generally
by other environmental finance.

While the response to these moves was generally positive [43] possibly because ecological
protection and energy and infrastructure transformation are more politically neutral than
pressures to change social policy. Some experts voiced concern that the IMF was not
representative, and that the IMF proposals to generate only 200 billion dollars/year by
2020 with the SDRs as seed funds, did not go far enough to undo the general incentive to
pursue destructive projects inherent in the world commodity trading and banking systems
- criticisms often levelled at the WTO and large global banking institutions.
In the context of the May 2010 European banking crisis, some observers also noted that
Spain and California, two troubled economies within Europe and the United States
respectively, and also Germany, the primary and politically most fragile supporter of a
Euro currency bailout would benefit from IMF recognition of their leadership in green
technology, and directly from Green-Fund generated demand for their exports, which
might also improve their credit standing with international bankers.

[edit] Criticism from free-market advocates

Typically the IMF and its supporters advocate a monetarist approach. As such, adherents
of supply-side economics generally find themselves in open disagreement with the IMF.
The IMF frequently advocates currency devaluation, criticized by proponents of supply-
side economics as inflationary. Secondly they link higher taxes under "austerity
programmes" with economic contraction.

Currency devaluation is recommended by the IMF to the governments of poor nations

with struggling economies. Some economists claim these IMF policies are destructive to
economic prosperity.[44]

Complaints have also been directed toward the International Monetary Fund gold reserve
being undervalued. At its inception in 1945, the IMF pegged gold at US$35 per Troy
ounce of gold. In 1973, the administration of US President Richard Nixon lifted the fixed
asset value of gold in favor of a world market price. This need to lift the fixed asset value
of gold had largely come about because Petrodollars outside the United States were
worth more than could be backed by the gold at Fort Knox under the fixed exchange rate
system.[citation needed] Following this, the fixed exchange rates of currencies tied to gold were
switched to a floating rate, also based on market price and exchange. The fixed rate
system had only served to limit the nominal amount of assistance the organization could
provide to debt-ridden countries.

[edit] Managing director

Historically the IMF's managing director has been European and the president of the
World Bank has been from the United States. However, this standard is increasingly
being questioned and competition for these two posts may soon open up to include other
qualified candidates from any part of the world. Executive Directors, who confirm the
managing director, are voted in by Finance Ministers from countries they represent. The
First Deputy Managing Director of the IMF, the second-in-command, has traditionally
been (and is today) an American.

The IMF is for the most part controlled by the major Western Powers, with voting rights
on the Executive board based on a quota derived from the relative size of a country in the
global economy. Critics claim that the board rarely votes and passes issues contradicting
the will of the US or Europeans, which combined represent the largest bloc of
shareholders in the Fund. On the other hand, Executive Directors that represent emerging
and developing countries have many times strongly defended the group of nations in their
constituency. Alexandre Kafka, who represented several Latin American countries for 32
years as Executive Director (including 21 as the dean of the Board), is a prime example.

Rodrigo Rato became the ninth Managing Director of the IMF on June 7, 2004 and
resigned his post at the end of October 2007.

EU ministers agreed on the candidacy of Dominique Strauss-Kahn as managing director

of the IMF at the Economic and Financial Affairs Council meeting in Brussels on July
10, 2007. On September 28, 2007, the International Monetary Fund's 24 executive
directors elected Mr. Strauss-Kahn as new managing director, with broad support
including from the United States and the 27-nation European Union. Strauss-Kahn
succeeded Spain's Rodrigo de Rato, who retired on October 31, 2007.[45] The only other
nominee was Josef Tošovský, a late candidate proposed by Russia. Strauss-Kahn said: "I
am determined to pursue without delay the reforms needed for the IMF to make financial
stability serve the international community, while fostering growth and employment."[46]

Dates Name Nationality

The International Finance Corporation (IFC) promotes sustainable private sector

investment in developing countries.

IFC is a member of the World Bank Group and is headquartered in Washington, DC. It
shares the primary objective of all World Bank Group institutions: to improve the quality
of the lives of people in its developing member countries.[1]

Established in 1956, IFC is the largest multilateral source of loan and equity financing for
private sector projects in the developing world. It promotes sustainable private sector
development primarily by:

1. Financing private sector projects and companies located in the developing world.
2. Helping private companies in the developing world mobilize financing in
international financial markets.
3. Providing advice and technical assistance to businesses and governments.
Contents
[hide]

• 1 IFC History
• 2 Ownership and management
o 2.1 Membership
• 3 Funding
• 4 Activities
• 5 See also
• 6 References

• 7 External links

[edit] IFC History

Six Decades of Creating Opportunity

A daring new idea when created in the 1950s, IFC is the largest organization of its kind in
the world. A sense of innovation and the strength of our core corporate values--
excellence, commitment, integrity and teamwork--have driven this remarkable growth
over the years. [2]

[edit] Ownership and management

IFC has 182 member countries , which collectively determine its policies and approve
investments. To join IFC, a country must first be a member of the International Bank for
Reconstruction and Development (IBRD). IFC's corporate powers are vested in its Board
of Governors, to which member countries appoint representatives. IFC's share capital,
which is paid in, is provided by its member countries, and voting is in proportion to the
number of shares held. As of June 30, 2010 and 2009, IFC’s authorized capital(the sums
contributed by its members over the years) was $2.45 billion, of which $2.37 billion was
subscribed and paid in.

The Board of Governors delegates many of its powers to the Board of Directors, which is
composed of the Executive Directors of the IBRD, and which represents IFC's member
countries. The Board of Directors reviews all projects.

The President of the World Bank Group, Robert Zoellick, also serves as IFC's president.
IFC's CEO and Executive Vice President, Lars H. Thunell, is responsible for the overall
management of day-to-day operations. He was appointed on January 15, 2006.

Although IFC coordinates its activities in many areas with the other institutions in the
World Bank Group, IFC generally operates independently as it is legally and financially
autonomous with its own Articles of Agreement, share capital, management and staff.
[edit] Membership

International Finance Corporation member states

Members of the IFC are 181 of the UN members and Kosovo.

Non-members are: San Marino, Suriname, Tuvalu, Brunei, Saint Vincent and the
Grenadines, Cuba, North Korea, Andorra, Monaco, Liechtenstein, Nauru, Cook Islands,
Niue, Vatican City and the rest of states with limited recognition.

[edit] Funding
The IFC's equity and quasi-equity investments are funded out of its paid-in capital and
retained earnings (which comprise its net worth). Strong shareholder support, triple-A
ratings, and a substantial capital base allow the IFC to raise funds on favorable terms in
international capital markets.

[edit] Activities
Within the World Bank Group, the World Bank finances projects with sovereign
guarantees, while the IFC finances projects without sovereign guarantees. This means
that the IFC is primarily active in private sector projects, although some projects in the
public sector (at the municipal or sub-national level) have recently been funded.

Private sector financing is IFC's main activity, and in this respect is a profit-oriented
financial institution (and has never had an annual loss in its 50-year history). Like a bank,
IFC lends or invests its own funds and borrowed funds to its customers and expects to
make a sufficient risk-adjusted return on its global portfolio of projects.

IFC's activities, however, must meet a second test of contributing to a reduction in

poverty in line with its mandate. In practice, this is broadly interpreted, but considerable
time and effort is devoted to both (i) selecting projects with positive developmental
outcomes, and (ii) improving the developmental outcome of projects by various means.

IFC provides both investment and advisory services. IFC also carries out technical
cooperation projects in many countries to improve the investment climate. These
activities may be linked to a specific investment project, or, increasingly, to broader goals
such as improving the legislative environment for a specific industry. IFC's technical
cooperation projects are generally funded by donor countries or from IFC's own budget.

IFC's Advisory Services focus on five core areas: Access to Finance, Business Enabling
Environment, Environmental & Social Sustainability, Infrastructure Advisory, and
Corporate Advice. Advisory services to expand access to finance (A2F) often
accompanies IFC's financial investments, and includes assistance to banks and
specialized financial institutions in improving their ability to provide financial services to
micro, small, and medium enterprises.

After successful pilots in several countries, the WorldHotel-Link project was successfully
spun off from the IFC on 31 March 2006 and is now a private company with global reach
helping locally owned small scale travel service providers in developing-world
destinations overcome market access barriers.

CommDev (The Oil, Gas and Mining Sustainable Community Development Fund) is a
funding mechanism for practical capacity building, training, technical assistance,
implementation support, awareness-raising, and tool development. Operating flexibly and
efficiently, CommDev serves as an integral component of an extractive industry project,
enhancing, accelerating, and extending the value-added support given to communities
beyond the compliance requirements of IFC investment projects and World Bank loan.

Critics have questioned the sustainability of some IFC-funded projects. The IFC recently
invested $9 million in the upgrading of a slaughterhouse facility in the Amazon region
owned by Brazil's biggest beef producer, despite opposition from local NGOs and the
Sierra Club.[3] In 2009 an internal audit found that the IFC had ignored its own
environmental and social protection standards when it approved nearly $200 million in
loan guarantees for palm oil production in Indonesia.[4]
The Export Credit Guarantee Corporation of India Limited (ECGC in short) is a
company wholly owned by the Government of India based in Mumbai, Maharashtra.[1] It
provides export credit insurance support to Indian exporters and is controlled by the
Ministry of Commerce. Government of India had initially set up Export Risks Insurance
Corporation (ERIC) in July 1957. It was transformed into Export Credit and Guarantee
Corporation Limited (ECGC) in 1964 and to Export Credit Guarantee of India in 1983.

Contents
[hide]

• 1 History
• 2 What does ECGC do?
• 3 How does ECGC help exporters?
• 4 Need for export credit insurance
• 5 Notable Records=
o 5.1 References

o 5.2 External links

[edit] History
ECGC of India Ltd, was established in July, 1957 to strengthen the export promotion by
covering the risk of exporting on credit. [2] It functions under the administrative control of
the Ministry of Commerce & Industry, Department of Commerce, Government of India.
It is managed by a Board of Directors comprising representatives of the Government,
Reserve Bank of India, banking, insurance and exporting community. [3]

ECGC is the fifth largest credit insurer of the world in terms of coverage of national
exports. The present paid-up capital of the company is Rs.900 crores and authorized
capital Rs.1000 crores. [4]

[edit] What does ECGC do?

• Provides a range of credit risk insurance covers to exporters against loss in export
of goods and services

• Offers guarantees to banks and financial institutions to enable exporters to obtain

better facilities from them

• Provides Overseas Investment Insurance to Indian companies investing in joint

ventures abroad in the form of equity or loan

[edit] How does ECGC help exporters?

• Offers insurance protection to exporters against payment risks

• Provides guidance in export-related activities

• Makes available information on different countries with its own credit ratings

• Makes it easy to obtain export finance from banks/financial institutions

• Assists exporters in recovering bad debts

• Provides information on credit-worthiness of overseas buyers

[edit] Need for export credit insurance

Payments for exports are open to risks even at the best of times. The risks have assumed
large proportions today due to the far-reaching political and economic changes that are
sweeping the world. An outbreak of war or civil war may block or delay payment for
goods exported. A coup or an insurrection may also bring about the same result.
Economic difficulties or balance of payment problems may lead a country to impose
restrictions on either import of certain goods or on transfer of payments for goods
imported. In addition, the exporters have to face commercial risks of insolvency or
protracted default of buyers. The commercial risks of a foreign buyer going bankrupt or
losing his capacity to pay are aggravated due to the political and economic uncertainties.
Export credit insurance is designed to protect exporters from the consequences of the
payment risks, both political and commercial, and to enable them to expand their
overseas business without fear of loss.

Cooperation agreement with MIGA (Multilateral Investment Guarantee Agency) an arm

of World Bank. MIGA provides

1. Political insurance for foreign investment in developing countries.

2. Technical assistance to improve investment climate.
3. Dispute mediation service.

Under this agreement protection is available against political and economic risks such as
transfer restriction, expropriation, war, terrorism and civil disturbances etc.

[edit] Notable Records=

• Largest Policy – short term Rs.250 crores
• Largest database on buyers 3 lakhs
• Largest credit limit Rs.80 Crores
• Largest claim paid Rs.120 crores
• Quickest claim paid 2 days
• Highest compensation-Iraq Rs 788 Crores[citation needed]

ECGC now offers various products for the exporters and bankers. If readymade products
are NOT suited to an exporter/banker then ECGC designs tailor made products.