International Monitory Fund (IMF)
Founding and mission:
The
IMF was conceived in July 1944 at the United Nations Bretton Woods Conference
in New Hampshire, United States.
The
44 countries sought to build a framework for international economic cooperation
and avoid repeating the competitive currency devaluations that contributed to
the Great Depression of the 1930s.
The
IMF's primary mission is to ensure the stability of the international
monetary system—the system of exchange rates and international payments
that enables countries and their citizens to transact with each other.
In order to maintain
stability and prevent crises in the international monetary system, the IMF
monitors member country policies as well as national, regional, and global
economic and financial developments through a formal system known as
surveillance.
The IMF provides advice to
member countries and promotes policies designed to foster economic stability,
reduce vulnerability to economic and financial crises, and raise living
standards.
It also provides periodic assessments of global prospects in its World Economic Outlook, of financial markets in its Global Financial Stability Report, of public finance developments in its Fiscal Monitor.
Providing loans to member
countries that are experiencing actual or potential balance-of-payments
problems is a core responsibility of the IMF.
Individual country
adjustment programs are designed in close cooperation with the IMF and are
supported by IMF financing..
In response to the global
economic crisis, in April 2009 the IMF strengthened its lending capacity and
approved a major overhaul of its financial support mechanisms, with additional
reforms adopted in subsequent years.
These changes enhanced the IMF’s
crisis-prevention toolkit, bolstering its ability to mitigate contagion during
systemic crises and allowing it to better tailor instruments to meet the needs
of individual member countries.
Loan resources available
to low-income countries were sharply increased in 2009, while average limits
under the IMF’s concessional loan facilities were doubled.
Capacity
development:
The
IMF provides technical assistance and training to help member countries build
better economic institutions and strengthen related human capacities.
This
includes, designing and implementing more effective policies for taxation and
administration, expenditure management, monetary and exchange rate policies,
banking and financial system supervision and regulation, legislative
frameworks, and economic statistics.
Organization
& Finances:
The IMF has a management
team and 17 departments that carry out its country, policy, analytical, and
technical work. One department is charged with managing the IMF’s resources.
This section also explains where the IMF gets its resources and how they are
used.
Management
The IMF has a Managing
Director, who is head of the staff and Chairperson of the Executive Board. The
Managing Director is appointed by the Executive Board for a renewable term of
five years and is assisted by a First Deputy Managing Director and three Deputy
Managing Directors.
Staff
The IMF’s employees come
from all over the world; they are responsible to the IMF and not to the
authorities of the countries of which they are citizens. The IMF staff is
organized mainly into area; functional; and information, liaison, and support
responsibilities.
IMF
Resources
Most resources for IMF
loans are provided by member countries, primarily through their payment of
quotas.
Quotas
Quota subscriptions are a
central component of the IMF’s financial resources. Each member country of the
IMF is assigned a quota, based broadly on its relative position in the world
economy.
Special
Drawing Rights (SDRs)
The SDR is an international
reserve asset, created by the IMF in 1969 to supplement its member countries’
official reserves.
Special drawing rights
(SDRs) are supplementary foreign exchange reserve assets defined and maintained
by the International Monetary Fund (IMF). SDRs are units of account for the IMF,
and not a currency per se. They represent a claim to currency held by IMF
member countries for which they may be exchanged.
While the ISO 4217
currency code for special drawing rights is XDR, they are often referred to by
their acronym SDR. Both refer to the name "special drawing rights".
Gold
Gold remains an important
asset in the reserve holdings of several countries, and the IMF is still one of
the world’s largest official holders of gold.
Borrowing
Arrangements
While quota subscriptions
of member countries are the IMF's main source of financing, the Fund can
supplement its quota resources through borrowing if it believes that they might
fall short of members' needs.
Resources:
Member quotas are the
primary source of IMF financial resources.
A member’s quota broadly reflects its size and
position in the world economy.
The IMF regularly conducts general reviews of
quotas. The lastest review (the 14thReview) was concluded in 2010 and the quota
increases became effective in 2016.
This review doubled quota
resources to SDR 477 billion (about US$661 billion).
In addition, credit arrangements between the
IMF and a group of members and institutions provide supplementary resources of
up to about SDR 182 billion ($253 billion), and are the main backstop to
quotas.
As a third line of defence,
member countries have also committed resources to the IMF through bilateral
borrowing agreements, totaling about SDR 317 billion ($440 billion).
Governance
and organization:
The IMF is accountable to
its member country governments.
At the top of its
organizational structure is the Board of Governors , consisting of one governor
and one alternate governor from each member country, usually the top officials
from the central bank or finance ministry.
The Board of Governors
meets once a year at the IMF–World Bank Annual Meetings .
Twenty-four of the
governors serve on the International Monetary and Financial Committee, or IMFC,
which advises the IMF's Executive Board on the supervision and management of
the international monetary and financial system.
The day-to-day work of the
IMF is overseen by its 24-member Executive Board , which represents the entire
membership and supported by IMF staff.
The Managing Director is the head of the IMF staff and Chair of the Executive Board and is assisted by four Deputy Managing Directors.
Kristalina Georgieva was
selected Managing Director of the IMF on September 25, 2019. She assumed her
position on October 1, 2019.
Mr. Geoffrey Okamoto as First Deputy Managing Director, effective March 19, 2020.
Deputy Managing Director Antoinette
Sayeh
Deputy Managing Director
Mitsuhiro Furusawa
Deputy Managing Director
Tao Zhang
Economic Counsellor and
Research Department Director Gita
Gopinath
Resource compiled from
https://www.imf.org
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