Question Essay Example
18 June 2013
International Monetary Fund
The International Monetary fund or IMF as is infamously known is an organization that has come to establish itself as a very vital one in the financial welfare, growth and development of many nations in the world. The IMF organization was established after the Second World War was designed to assist countries affected by the war rebuild their economies and reestablish their selves back onto the growth path. The IMF was set up to protect the international financial system. In order to achieve its goals, the IMF focuses on a number of stretch goals as the following discourse details.
The promotion of global monetary cooperation
After the Second World War, many countries in the world experienced a crisis in their currencies and the general economy. Most countries started losing their trust and value in their currencies and there were financial outcries all over the world. There was a need to harmonize the monetary cooperation in the world and IMF stepped in to do just that. The United States dollar was placed as the base currency, measurable in certain ounces of gold of equivalent value. The value of the other currencies was standardized against this dollar and the monetary cooperation was established.
Stability of the country financial standing
After a survey, IMF established that most countries in the world were suffering from major economic downturns. Most countries were struggling with huge debts that were crippling the economies of these nations. The IMF came in to try to offer assistance in the stabilization of the countries’ economies through offering financial advice and in extreme cases, actual financial assistance.
The increase in international trade
IMF also plays a great role in the development of international trade. The fact that the organization tries to uplift the economies of the world by bringing them together fosters international trade between these countries. Increased international trade leads to a balance of payments making the nations that have excess supply become able to dispose of these supplies.
Advancing economic growth and high employment rate
In order to address the issue of economic growth and employment rate, a country must be capable of attracting investment opportunities. IMF facilitates this through offering loans and grants to help in the facilitation of the same. Member countries are accorded the loan facilities to build up industries and infrastructure that attracts foreign domestic investments and consequently leads to the creation of more employment opportunities.
Reduce the need and poverty around the world
Over half of the countries in the world have been in situations that have been described as being in dire poverty especially after the Second World War. This has been a great concern for an organization like IMF that was formed to curb exactly that. Poverty eradication is among the top most agenda and prerogative of the organization. This it does through a process of sensitization and financial advice to these nations upon how they could eradicate poverty in their countries. In extreme scenarios, the organization also gives the affected member countries loans and grants to help ease the burden of poverty.
The above discourse has highlighted the major tenets in which the IMF utilized in the process of ensuring that nations in the world achieve financial stability and economic growth. However, it has been noted that this is a continuous process that takes time to be implemented. Although the dedications of the organization in fulfilling its goals have seen it succeed numerous times.
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