INTERNATIONAL INSTITUTIONS

LEARNING OBJECTIVES
● To learn about the origins of the World Bank and
International Monetary Fund
● To understand international monetary and
financial systems and its constituents
● To discuss the purpose, structure, and
governance of international financial institutions
● To describe the procedure of lending by
different international financial institutions

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International Institutions
● International financial institutions are the
international organisations that give loans to
governments for large-scale projects on the
condition that they increase the economic
growth.
● The main aim of setting up these institutions
is to promote the economic growth and to
reduce any depressions in the economy

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International organisations
● Economic and Trade Organisation
● Financial Organisation

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Evolution of International
Monetary and Financial Systems
I. The Gold Standard (1880–1913)
II. The Interim Years (1914–1944)
III. Bretton Woods (1945–1971)

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International

Financial Institutions (IFIs)
● The objectives of IFIs
● poverty alleviation,
● Economic
● growth, and protection of the environment

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IMF
● The IMF is an inter-governmental organisation
to promote international monetary
cooperation, exchange stability, and orderly
exchange arrangements.

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Main Functions of IMF
● Surveillance
● Lending
● Technical Assistance

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Governance of IMF
● Board of Governors
● Ministerial Committees
● The Executive Board

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World Bank
● The World Bank was created to lend to
primarily European countries that had been
destroyed in the war to help them rebuild their
economies.
● It evolved from the International Bank for
Reconstruction and Development (IBRD).
● The World Bank derives its support from 180
member nations and pitches bond offerings to
the world’s capital markets.

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Objectives of World bank
1. to help member states to reconstruct and
develop by facilitating capital investment;
2. to promote foreign private investment; and
3. to promote the long-range balanced growth of
international trade and the maintenance
of equilibrium in balances of payments.

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Main Functions of World Bank
● Lending
● Development Strategy
● Financial Services
● Data Collection

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Principal Operating Units of
World Bank
● International Bank for Reconstruction and
Development (IBRD)
● International Financial Corporation (IFC)
● International Development Association (IDA)
● Multilateral Investment Guarantee Agency
(MIGA)
● International Centre for Settlement of
Investment Disputes (ICSID)

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