The Collapse of the Bretton Woods System Has Made Redundant the Well-Defined Purpose of the Imf When It Was Created in 1944. Do You Think the Imf Has Still a Role to Play in This 21st Century?
THE COLLAPSE OF THE
BRETTON WOODS SYSTEM HAS
MADE REDUNDANT THE WELL-DEFINED
PURPOSE OF THE IMF
WHEN IT WAS CREATED IN 1944.
DO YOU THINK THE IMF HAS STILL A ROLE TO PLAY IN THIS 21ST CENTURY?
Table of Content Pg
1.Introduction: History and role of the International Monetary Fund 2
2.The IMF after the collapse of Bretton Woods System 6
3.Criticisms of IMF 8
4.The world still need the IMF 13
5.Conclusion 16
6.Bibliography 18
1.INTRODUCTION - History & Role of IMF
History
The IMF was founded to help restore economic stability and growth in the repercussion of the World War II. Half a century later, the institution is still working to promote these goals, but in a world that has changed. In particular, the international economy is now dominated by massive private capital flows, flows that are opening new opportunities for investment, trade, and growth to an ever larger number of countries. Net private capital flows to emerging market economies continued to increase while maturities lengthened and spreads declined. So, one may well ask: in this day, do we still need the IMF?
The evolution of the International Monetary System was such that, in the early days by the end of 7th century B.C, there was the use of gold and silver coins to enable trade between nations and it also constituted a particular economy’s reserve. After the gold coin standard, came into existence the International Gold Standard- 17th-19th century, which also witnessed some turbulence during the years 1901-1932.
After World War I most countries wanted to return to the old financial security system and stable situation of pre-war times as soon as possible. Discussions about a return to the gold standard began and by 1926 all leading economies had re-established the system, according to which every nation’s circulating money had to be backed by reserves of gold and foreign currencies to a certain extent. But there were
BRETTON WOODS SYSTEM HAS
MADE REDUNDANT THE WELL-DEFINED
PURPOSE OF THE IMF
WHEN IT WAS CREATED IN 1944.
DO YOU THINK THE IMF HAS STILL A ROLE TO PLAY IN THIS 21ST CENTURY?
Table of Content Pg
1.Introduction: History and role of the International Monetary Fund 2
2.The IMF after the collapse of Bretton Woods System 6
3.Criticisms of IMF 8
4.The world still need the IMF 13
5.Conclusion 16
6.Bibliography 18
1.INTRODUCTION - History & Role of IMF
History
The IMF was founded to help restore economic stability and growth in the repercussion of the World War II. Half a century later, the institution is still working to promote these goals, but in a world that has changed. In particular, the international economy is now dominated by massive private capital flows, flows that are opening new opportunities for investment, trade, and growth to an ever larger number of countries. Net private capital flows to emerging market economies continued to increase while maturities lengthened and spreads declined. So, one may well ask: in this day, do we still need the IMF?
The evolution of the International Monetary System was such that, in the early days by the end of 7th century B.C, there was the use of gold and silver coins to enable trade between nations and it also constituted a particular economy’s reserve. After the gold coin standard, came into existence the International Gold Standard- 17th-19th century, which also witnessed some turbulence during the years 1901-1932.
After World War I most countries wanted to return to the old financial security system and stable situation of pre-war times as soon as possible. Discussions about a return to the gold standard began and by 1926 all leading economies had re-established the system, according to which every nation’s circulating money had to be backed by reserves of gold and foreign currencies to a certain extent. But there were
References: 1.http://www.americanprogress.org/issues/2008/04/new_role.html 2.http://www.imf.org/external/np/speeches/2006/062906.htm 3.http://www.cato.org/pubs/journal/cj17n3-11.html 4.http://papers.ssrn.com/sol3/papers.cfm?abstract_id=232109 5.http://www.imf.org/external/np/speeches/2006/062906.htm 6.http://www.americanprogress.org/issues/2008/04/new_role.html