Finance
MOIZ KALABHAI STUDENT NUMBER-120491980 MBA CLASS 2013
ESSAY THE ROLE OF INTERNATIONAL MONETARY FUND
1
CONTENTS I–
Page
INTRODUCTION……………………………………………………………………………………….2
II – Brief History of Bretton Woods System……………………………………………………2 III – Formation of International Monetary Fund (IMF)…………………………………….3 IV – Role of IMF………………………………………………………………………………………………3 V – Post Period of 1972-81 (The Floating Exchange Rate Era)………………………….4 VI – Current Financial Crisis…………………………………………………………………………….6 VII – IMF Response to Current Financial Crisis…………………………………………………..11 VIII – Conclusion: Role of IMF in Future…………………………………………………………….13 IX – References……………………………………………………………………………………………….15
I – INTRODUCTION
2
This essay will critically describe and discuss the role of International Monetary Fund in the current financial crisis and also the role it will play in shaping the Global Political Economy in the future. II – Brief History of Bretton Woods System Over the past century, the global economies had suffered numerous shocks ranging from series of war such as World War I and World World II and Great Depression of 1930. The stability of all the world economy got heavily affected during that period and the new global financial system became a necessity. In order to create a harmonious world community in which the population of every nation will be able to realize their strengths and weaknesses and to create a long lasting peace the idea of stabilization of world currency was introduced in Bretton Woods International Monetary Conference in 1944 (Das, 2003). The then US president Franklin Roosevelt has invited the delegates of 44 allies and members associate countries at Bretton Woods New Hampshire on the opening of United Nations International Monetary conference (1944 Bretton Woods International Monetary Conference). The delegates to Bretton Woods System was headed by Henry Morgenthau and also Harry Dexter White who was Roosevelt chief economist to create a
ESSAY THE ROLE OF INTERNATIONAL MONETARY FUND
1
CONTENTS I–
Page
INTRODUCTION……………………………………………………………………………………….2
II – Brief History of Bretton Woods System……………………………………………………2 III – Formation of International Monetary Fund (IMF)…………………………………….3 IV – Role of IMF………………………………………………………………………………………………3 V – Post Period of 1972-81 (The Floating Exchange Rate Era)………………………….4 VI – Current Financial Crisis…………………………………………………………………………….6 VII – IMF Response to Current Financial Crisis…………………………………………………..11 VIII – Conclusion: Role of IMF in Future…………………………………………………………….13 IX – References……………………………………………………………………………………………….15
I – INTRODUCTION
2
This essay will critically describe and discuss the role of International Monetary Fund in the current financial crisis and also the role it will play in shaping the Global Political Economy in the future. II – Brief History of Bretton Woods System Over the past century, the global economies had suffered numerous shocks ranging from series of war such as World War I and World World II and Great Depression of 1930. The stability of all the world economy got heavily affected during that period and the new global financial system became a necessity. In order to create a harmonious world community in which the population of every nation will be able to realize their strengths and weaknesses and to create a long lasting peace the idea of stabilization of world currency was introduced in Bretton Woods International Monetary Conference in 1944 (Das, 2003). The then US president Franklin Roosevelt has invited the delegates of 44 allies and members associate countries at Bretton Woods New Hampshire on the opening of United Nations International Monetary conference (1944 Bretton Woods International Monetary Conference). The delegates to Bretton Woods System was headed by Henry Morgenthau and also Harry Dexter White who was Roosevelt chief economist to create a
References: 14. Xafa, M. (fall 2010) 'Role of the IMF in global financial crisis 15. CATO Journal, Vol 30, no 3, pp. 475-489.