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2. Formation: Bretton Woods Conference On 22nd July 1944 To prevent the global crises like the Great Depression IMFs Headquarter is located in Washington D.C. INTERNATIONAL MONETARY FUND 3. IMF came into existence on December 27, 1945 when 29 countries signed the Articles of Agreement It originally had 45 members But now . The IMF describes itself as an organization of 188 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world. Purpose Of Formation 4. Fast Facts on the IMF Membership: 188 countries Headquarters: Washington, D.C. Executive Board: 24 Directors representing countries or groups of countries Staff: Approximately 2,475 from 156 countries Total quotas: US$360 billion (as of 8/9/12) Additional pledged or committed resources: US$1 trillion Loans committed (as of 8/9/12): US$243 billion, of which US$186 billion have not been drawn Biggest borrowers (amount agreed as of 8/9/12): Greece, Portugal, Ireland Biggest precautionary loans (amount agreed as of 8/9/12): Mexico, Poland, Colombia Surveillance consultations: Consultations concluded for 128 countries in FY2011 and for 117 countries in FY2012 Technical assistance: Field delivery in FY2011198.2 person years Transparency: In 2011, about 90 percent of Article IV and program-related staff reports and policy papers were published Original aims: Article I of the Articles of Agreement sets out the IMFs main goals: promoting international monetary cooperation; facilitating the expansion and balanced growth of international trade; promoting exchange stability; assisting in the establishment of a multilateral system of payments; and making resources available (with adequate safeguards) to members experiencing balance of payments difficulties 5. Surveillance To maintain stability and prevent crises in the international monetary system, the IMF reviews country policies, as well as national, regional, and global economic and financial developments through a formal system known as surveillance Financial assistance IMF financing provides member countries the breathing room they need to correct balance of payments problems Technical assistance 1) Monetary and financial policies 2) Fiscal policy and management 3) Statistics 4) Economic and financial legislation. ROLE OF IMF IN THE WORLD 6. Quota System Special Drawing Rights (SDRs) Gold Holdings How is IMF Financed? 7. IMF & The WORLD BANK The World Banks mandate: The World Bank promotes long-term economic development and poverty reduction by providing technical and financial support to help countries reform particular sectors or implement specific projects The IMFs mandate: The IMF promotes international monetary cooperation and provides policy advice and technical assistance. IMF loans are short and medium term and funded mainly by the pool of quota contributions that its members provide. 8. Pakistan & IMF Zariyan Hassan 9. History Pakistan became member of IMF in 1988 11 Loans have been contracted from the IMF SIX LOANs were drawn during Benazir Bhuttos era: the SAP, PRGF & Extended SAP Two loans drawn during Nawaz Shariffs era. Two Loans during during Mushraffs. Most recent is the $ 7.8 Billion Loan 10. Common Conditions IMF Close Monitoring Reduction Of Government Spending Increase in Tax to GDP Ratio Change In Monetary Policy Removal of duties on Imports Removal of subsidies on exports 11. Musharaff Only era to receive full IMF loan installment Fulfilled all IMF conditions in 2000 Government saw a increased GDP growth 12. Alternatives Asian Development Bank China World Bank 13. Advantages Of IMF Borrowing Immediate allocation of Funds (Sometimes Entire Lump sums) Governments been able to come out of immediate debt. Payment of import bills Aversion of Economic Crisis 14. Disadvantages Of IMF Borrowing Unsubstantial changes in Economic reforms Short term breakthrough Mounting debt and increased Payback interest rates 15. Is it Beneficial Government approach for bailout Continuation of cyclical debt Intrusive policies Governments inability to initiate proper reform 16. Conclusion Government Expenditure Lack of implementation of reforms by the government IMF seen as a support mechanism or fail safe to bailout government No IMF loan except Mushrafs extended loans adopted proper changes and availed full IMF fund coverage 17. UN Report UN Ambassador to Pakistan visited again in 2010. Her official report follows 18. Section of the report She said that she was feeling awful at that time to see so much food at the table, suffice for hundreds of flood victims who were fighting like crazy to get a small bag of flour and a small bottle of water. She was ill at ease when she saw the interior of lavish Premier house and some of the government buildings and the chartered planes and other such luxuries, when there was so much misery outside. In her report to the United Nations, she has recommended UN to ask Pakistani government to first cut down on their expenses and to first cut down their luxuries before asking aid from the world. IMF or World Bank. 19. Recommendations Long Term Abolish Democracy in its current stature Encourage the people of Pakistan FOR Pakistan Substantial decrease in Government spending Huge investment in Developmental expenditure Create governmental entrepreneurship and revenue building sources to meet fund requirements Increase tax to GDP growth Consistent extensive economic reforms. 20. Refrences http://www.thenews.com.pk/Todays-News-9- 109784-Pakistan-and-the-IMF http://archives.dawn.com/archives/25179 http://www.bashaoorpakistan.com/featured/report s/angelina-jolie-criticize-pakistani-politicians- didnt-dine/ Opinion :Pakistan and the IMF Dr Muhammad Yaqub Tuesday, May 22, 2012 From Print Edition 21. Refrences http://en.wikipedia.org/wiki/International_Monetary_Fu nd#Functions http://www.imf.org/external/np/exr/facts/imfwb.htm http://www.imf.org/external/np/exr/facts/glance.htm http://www.bot.or.th/English/AboutBOT/index/Pa ges/IMF_index.aspx http://www.economicshelp.org/dictionary/i/imf.html 22. Your Welcome
