International Monetary Fund (IMF) - Important Facts

The International Monetary Fund is an international organisation which work for standardisation of global financial relations and exchange rates. 

• Membership-188 countries.
• Headquarters of IMF - Washington DC
• Executive Board - 24 Directors each representing a single country a single country or group of countries
• Staff - Approximately 2600 from 147 countries
• Biggest Borrowers - Portugal, Greece, Ireland and Ukraine
• Biggest Precautionary loans - Mexico, Poland, Colombo and Morocco
• Highest Voting Power - United States

IMF has a management team and 17 departments to carry out its work

IMF has a Managing Director, who is the head of the staff and Chairperson of Executive Board.The Managing Director is appointed by Executive Board for a renewable term of five years.

The current Managing Director of IMF is Christine Lagarde.

Establishment:

• It was established at the conference of 44 nations held at Bretton Woods,New Hampshire, USA, in July 1944.
• IMF was officially created in 1945 with 29 member countries.

It was established to prevent unstable exchange rates and competitive devaluation among economies.

AIMS OF IMF:

• IMF promotes international monetary cooperation
• It helps in expansion and balanced growth of international trade 
• It promotes exchange stability
• It helps to remove deficiency in Balance of Payments

FUNCTIONS OF IMF:

• IMF set standards for global economy and monitors financial communications between countries.
• It helps its member countries by lending money to make their economies and financial structure stable.
• It assists the member countries to develop sustainable financial polices.
• It provides economic advice to countries to maximise their financial effectiveness.
• It helps developing countries to stabilise and sustain themselves in global economy.

IMF AND WORLD BANK

World Bank is an international organisation that provides loan to developing countries for long term projects.It was formed on July, 1944.

IMF's primarily goal is to stabilise exchange rates while World Bank's goal is to reduce poverty.

Both the organisation were established at Bretton Woods Conference.

IMF AND INDIA:

• Mr Arun Jaitely, Finance Minister of India is ex-officio Governor on the Board of Governors of IMF.
• Mr Raghuram Rajan, RBI Governor is alternate governor at the IMF.
• Executive Director Dr. Rakesh Mohan, represent India at IMF. He also represent three other countries - Bangladesh, Sri Lanka and Bhutan.

RELATED TERMS:

• SPECIAL DRAWING RIGHTS  - SDR is an international reserve asset , which was created by IMF in 1969. It is an artificial currency use by member countries to settle trade balances between countries and then repay IMF. It is also known as PAPER GOLD, but it is neither paper nor gold but an accounting entry.
• BALANCE OF PAYMENTS - It is the set of accounts that records a country's international transactions.

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