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IMF FOR DUMMIES

I'm at the IMF annual meetings in Washington DC, where the Global economy -where world economic outlook, poverty eradication and economic development are among the key issues on the agenda.

I was here last spring and I wish someone shared this with me before I came here in April.

So, here's IMF for dummies ( 1st Edition)





The IMF, also known as the “Fund,” was conceived at a United Nations conference convened in Bretton Woods, New Hampshire, United States, in July 1944. The 44 governments represented at that conference sought to build a framework for economic cooperation that would avoid a repetition of the vicious circle of competitive devaluations that had contributed to the Great Depression of the 1930s.

Original aims: Article I of the Articles of Agreement sets out the IMF’s main goals:

■promoting international monetary cooperation;
■facilitating the expansion and balanced growth of international trade;
■promoting exchange stability;
■assisting in the establishment of a multilateral system of payments; and
■making resources available (with adequate safeguards) to members experiencing balance of payments difficulties

Here's a further breakdown

Surveillance: To maintain stability and prevent crises in the international monetary system, the IMF reviews country policies, as well as national, regional, and global economic and financial developments through a formal system known as surveillance. Under the surveillance framework, the IMF provides advice to its 187 member countries, encouraging policies that foster economic stability, reduce vulnerability to economic and financial crises, and raise living standards.

Financial assistance: IMF financing provides member countries the breathing room they need to correct balance of payments problems. A policy program supported by IMF financing is designed by the national authorities in close cooperation with the IMF, and continued financial support is conditioned on effective implementation of this program.

SDRs: The IMF issues an international reserve asset known as Special Drawing Rights (SDRs) that can supplement the official reserves of member countries. Members can also voluntarily exchange SDRs for currencies among themselves

Technical assistance: The IMF provides technical assistance and training to help member countries strengthen their capacity to design and implement effective policies. Technical assistance is offered in several areas, including tax policy and administration, expenditure management, monetary and exchange rate policies, banking and financial system supervision and regulation, legislative frameworks, and statistics

Resources: The IMF’s resources are provided by its member countries, primarily through payment of quotas, which broadly reflect each country’s economic size.

Governance and organization: The IMF is accountable to the governments of its member countries. At the top of its organizational structure is the Board of Governors, which consists of one Governor and one Alternate Governor from each member country.

Source: IMF

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