International Monetary Fund is a specialized agency of the United Nations (), created to develop international financial cooperation and international stability in the monetary and financial sphere. The IMF also strives to promote international trade, high employment and sustainable economic growth, and poverty reduction worldwide. The IMF is governed by and accountable to the organization's 188 member countries. Although the IMF is a specialized agency of the United Nations and participates in the UN Economic and Social Council, it operates independently and has its own charter, governance structure and finances.
History of the creation of the IMF
The idea for the creation of the IMF originated at the UN conference in Bretton Woods, New Hampshire, USA, in July 1944, when the 44 countries represented at this conference aimed to form a basis for economic cooperation to avoid a repetition of devaluation in order to gain competitive advantages , which became one of the main causes of the Great Depression of the 1930s, and also contributed to the reconstruction of the international financial system after World War II. The IMF was officially created in 1945 by 29 founding countries, and became, along with , one of two international financial organizations established as a result of the Bretton Woods conference. Currently, the IMF and the World Bank cooperate in a variety of areas and also regularly hold joint meetings.
IMF mission
Goals and objectives of the IMF:
- To promote the development of international monetary and financial cooperation.
- To promote the process of expansion and balanced growth of international trade.
- Promote currency stability.
- Assist in the creation of a multilateral settlement system.
- Make resources (subject to adequate guarantees) available to Member States experiencing balance of payments difficulties.
The IMF's primary mission is to ensure the stability of the international monetary and financial system, the system of exchange rates and international settlements that allows countries (and their citizens) to transact with each other. This objective involves preventing economic and financial crises, large fluctuations in economic activity, high inflation and excessive volatility in exchange rates and financial markets. As recent financial crises have shown, countries are becoming increasingly interdependent, and difficulties in one sector can lead to difficulties in other sectors and spread to other countries. Economic and financial stability requires attention at both the national and multilateral levels. The IMF, through its surveillance, technical assistance, and lending functions, helps countries pursue sound and appropriate economic policies. The Fund's mandate was updated in 2012 to cover the full range of macroeconomic and financial sector issues that impact global stability.
Economic supervision:
Every country that joins the IMF accepts a commitment to open its economic and financial policies to scrutiny by the international community. In order to maintain stability and prevent crises in the international financial system, the IMF is charged with monitoring economic and financial changes in the world. This process, known as “surveillance,” is carried out both at the global level and at the individual countries and regions. Surveillance in its current form was introduced under Article IV of the IMF agreement, as amended in the late 1970s following the collapse of the Bretton Woods system of fixed exchange rates. Under Article IV, each member undertakes to cooperate with the IMF and other member countries in promoting stability. The IMF, on the other hand, has the responsibility to: 1) exercise control over the international monetary system to ensure its effective functioning; 2) monitor the fulfillment by each Member State of its obligations in relation to the policies pursued.
Through its surveillance process, which operates at both the global and country levels, the IMF reviews whether member countries' policies are consistent with the goals of sustainable and balanced global economic growth, identifies possible risks to stability, and recommends necessary policy changes. , promoting economic stability. In this way, it helps the international monetary system fulfill its main function, which is to facilitate the exchange of goods, services and capital between countries, thereby promoting sustainable economic growth.
IMF economists constantly monitor the economies of member states. They visit member states (usually once a year) to exchange views with their governments and central banks and examine whether there are risks to domestic and global stability that may require changes in countries' economic or financial policies. During their visits, IMF specialists also typically meet with other stakeholders, such as legislators, business representatives, trade unions and civil society, which helps in assessing the economic policy and direction of the country's development. Upon returning to headquarters, staff present their report to the Executive Board for consideration. The Council's views are subsequently communicated to national authorities, concluding a process known as Article IV consultation. In recent years, supervision has become increasingly transparent. Almost all Member States now agree to the publication of press releases summarizing the views of the Executive Board and staff reports and accompanying analyses. Many countries also publish a Fund staff statement at the end of an IMF mission.
The IMF also monitors trends in the global and regional economies and analyzes the effects of member countries' policies on the global economy. The key tools of multilateral surveillance are its regular publications. Grade global perspectives carried out in the publication "World Economic Outlook", financial markets - in the "Global Financial Stability Report" and changes in the sphere public finance- in the "Budget Bulletin". The IMF also publishes a number of publications on regional economic development prospects. Twice a year, the IMF prepares a list of current global economic policy issues that brings together the main findings and policy recommendations from the IMF's multilateral reports and sets the future agenda for the Fund and its member countries.
Financial aid:
IMF financing gives the organization's members the breathing space they need to overcome balance of payments problems. The country's authorities are developing economic policy programs supported by IMF financing in close cooperation with the IMF, with continued financial support conditional on effective implementation programs. In response to the global economic crisis of 2008, the IMF strengthened its lending capacity and approved a major overhaul of its financial assistance mechanisms in April 2009, followed by further reforms in 2010 and 2011. The IMF's lending tools have been enhanced to provide flexible crisis prevention tools for members with strong economic fundamentals, sound economic policies, and sound institutional frameworks for those policies. The IMF also doubled borrowing limits and increased lending to the world's poorest countries.
Technical assistance:
The IMF provides technical assistance and training to help member countries strengthen their capacity to design and implement effective policies, including in the areas of tax policy and administration, expenditure management, monetary and exchange rate policies, and banking and financial system supervision and management. regulation, legislative framework, and statistics.
Governance and organizational structure of the IMF:
The IMF's evolution has paralleled changes in the global economy throughout the organization's history, allowing it to maintain its leading role in the international financial system. The IMF is accountable to the governments of its member countries. Unlike, for example, General Assembly UN, in which each country has one vote, the IMF's decision-making process is designed to reflect the relative position of member states in the global economy. At the top level of its organizational structure is the Board of Governors, on which each of the IMF's member countries is represented by one governor and one deputy governor, usually from the Central Bank or the Ministry of Finance. The Board of Governors meets once a year at the Annual Meetings of the IMF and the World Bank. Twenty-four governors make up the International Monetary and Financial Committee (IMFC) and typically meet twice a year. The IMF's Executive Board, composed of 24 members, each representing a country or group of member countries, leads daily activities IMF at its headquarters in Washington; This work is led by the IMFC and supported by IMF staff. The current structure of the Board was established in 1992 following the expansion of the IMF to include former countries Soviet Union. Five executive directors are appointed by the member states with the five largest quotas (currently the United States of America, Japan, Germany, France and the United Kingdom), and 19 are elected by the remaining member states. The Managing Director of the IMF is both the Chairman of the IMF Executive Board and the IMF Chief of Staff. The Managing Director is assisted in his work by four Deputy Managing Directors. The Managing Director is appointed by the Executive Board for a renewable term of five years. The IMF's twenty-four governors and executive directors can nominate citizens of any member country of the Fund for this position.
IMF lending
One of the IMF's most important responsibilities is to provide credit to member countries facing actual or potential balance of payments difficulties. This financial assistance helps countries seeking to replenish their international reserves, stabilize their currencies, continue to pay for imports, and restore conditions for strong economic growth while taking steps to correct initial problems. Unlike development banks, the IMF does not provide loans for specific projects.
When can a country borrow funds from the IMF?
A member country may apply for IMF financial assistance if it has a need (actual or potential) for balance of payments financing, that is, it cannot find sufficient financing on affordable terms to cover net international payments (for example, for imports, to repay external debt) while maintaining sufficient reserves for the future. The IMF loan provides reserve capacity to facilitate the stabilization measures and reforms that the country must undertake to correct its balance of payments problem and restore conditions for strong economic growth.
The changing nature of IMF lending:
The volume of loans provided by the IMF has undergone significant fluctuations over time. Thus, the oil shock of the 1970s and the debt crisis of the 1980s were followed by a sharp increase in IMF loans. In the 1990s, transition in Central and Eastern Europe and crises in emerging market countries led to new surges in demand for IMF resources. Deep crises in Latin America kept demand for IMF resources high in the 2000s. IMF lending began to increase again in late 2008 after the global financial crisis.
IMF lending process:
Upon receipt of a member's request, IMF resources are typically provided under a “lending arrangement,” which, depending on the lending instrument used, may include specific policies and actions that the country agrees to undertake to resolve its balance of payments problem. The economic policy program underlying the arrangement is developed by the country in consultation with the IMF and, in most cases, is presented to the Fund's Executive Board in a Letter of Intent. Once the Board approves the arrangement, IMF resources are typically released in increments as the program progresses. Some arrangements provide countries with strong economic performance with one-time, immediate access to IMF financial resources and therefore do not require harmonization of policy requirements.
IMF lending instruments
In the course of its activities, the IMF has developed various lending instruments that have been adapted to cope with the specific situations of different member countries. Low-income countries can borrow at concessional interest rates through the Extended Credit Facility (ECF), Stand-By Facility (SCF) and Rapid Credit Facility (RCF).
Non-concessional lending:
Non-concessional loans are provided primarily through stand-by arrangements (SBAs), flexible credit lines (FCLs), precautionary liquidity facilities (PLLs), and the extended lending facility (which is used primarily for medium- and longer-term needs). The IMF can also provide emergency assistance to all its members with urgent needs to resolve their balance of payments, using the Rapid Financing Instrument (RFI). All non-concessional arrangements are subject to the IMF's market-linked interest rate. This is called the “charge rate”, and for large loans (above certain limits) an additional fee is charged. The fee rate is based on the SDR interest rate, which is adjusted weekly to reflect changes in short-term rates in major international money markets. The amount a country can borrow from the IMF is known as the access limit and varies depending on the type of loan, but it is usually a multiple of the country's IMF quota. In exceptional circumstances this limit may be exceeded. The Stand-By Arrangement, Flexible Credit Line and Extended Credit Facility do not have a predetermined upper limit on access.
Stand-by loan arrangements (SBA):
From a historical perspective, the bulk of IMF non-concessional assistance is provided through the SBA. SBAs are intended to help countries overcome short-term balance of payments problems. The program's objectives are to address these problems, and disbursements are conditional on the achievement of these objectives ("conditions"). The validity period of the SBA is usually 12–24 months, the loan is repaid within 3.4–5 years from the date of actual provision. SBA loans may be provided on a precautionary basis (where countries choose not to use approved loans but retain the option to do so if the situation worsens). The SBA provides for flexibility in terms of phasing, where appropriate, with a concentration of funds provided at the initial stage.
Flexible credit line (FCL):
The FCL is intended for countries with very good fundamental economic indicators, sound economic policies and a successful track record of policy implementation. FCL arrangements are approved at the request of the relevant Member States for countries that meet pre-established access criteria. The validity period of the FCL is one or two years, with an interim review of eligibility after one year. Access is determined taking into account the specific situation, it is not subject to access limits, funds can be provided immediately in one payment, and not in stages. The actual disbursement of funds under the FCL is not conditional on the implementation of specific policy agreements, as is the case with the SBA, since countries eligible for the FCL have demonstrated positive results in implementing appropriate macroeconomic policies. It is possible to use the credit line at the time of its approval or consider it preventive. The repayment terms of the FCL are the same as under the SBA.
Preventive Support and Liquidity Line (LPL):
The LPL is intended for countries with strong economic fundamentals, sound economic policies and a successful track record of implementing such policies. Eligible countries may have moderate vulnerabilities and may not meet FCL eligibility standards, but they do not require the major policy adjustments typically associated with SBAs. LPL combines eligibility criteria (similar to FCL) and targeted conditions that are designed to reduce remaining vulnerabilities. The duration of the LPL arrangement is six months or one to two years. Access under six-month LPL arrangements is limited to 250 percent of quota in the normal period, but this limit may increase to 500 percent of quota in exceptional circumstances when the need to finance the balance of payments is caused by exogenous shocks, including increased stress at the regional or global level. For LPL arrangements of one to two years, annual access is set at 500 percent of the quota, and for all LPL arrangements the total can be up to 1,000 percent of the quota. A country may receive funds from a credit line or consider it as a preventive mechanism. The repayment terms of the LPL are the same as under the SBA.
Extended Credit Facility (EFF):
This facility was created in 1974 to help countries overcome medium- and longer-term balance of payments problems caused by widespread distortions that require fundamental economic reforms. Its use has increased significantly during the recent crisis due to the structural nature of the balance of payments problems of some member states. As a rule, the term of agreements within the EFF is longer than under the SBA; usually it does not exceed three years at the time of approval. However, a maximum period of up to four years is also allowed, subject to the existence of balance of payments financing needs beyond the three-year period, the prolonged nature of the adjustment necessary to restore macroeconomic stability, and the existence of sufficient guarantees regarding the ability and willingness of the member state to carry out deep and consistent structural reforms . Repayment period: 4.5–10 years from the date of actual provision of funds.
Rapid Financing Instrument (RFI):
The RFI was introduced to replace the previous emergency assistance mechanisms and expand their scope. It provides rapid financial assistance with limited conditions to all member states facing acute balance of payments needs. Access under the RFI is limited to an annual limit of 50 percent of the quota and a general access limit of 100 percent of the quota. For emergency loans, the same conditions apply as for FCL, LPL and SBA, repayment terms are 3.5–5 years.
Concessional lending:
New concessional facilities for low-income countries came into force in January 2010 under the Poverty Reduction and Growth Trust (PRGT) and are part of a broader reform to make IMF financial support more flexible and appropriate. different needs of low-income countries. Access limits and standards have been approximately doubled relative to pre-crisis levels. Financing conditions have become more favorable, and the interest rate is reviewed every two years. All mechanisms are designed to support countries' own programs aimed at achieving a sustainable macroeconomic position consistent with the objective of achieving durable and long-term poverty reduction and economic growth.
The Extended Credit Facility (ECF) has replaced the Poverty Reduction and Growth Facility (PRGF) as the IMF's main medium-term support tool for low-income countries experiencing prolonged balance-of-payments difficulties. Financing under the ECF is currently carried out at a zero interest rate, with a grace period of 5.5 years and full term repayment in 10 years.
The Stand-By Credit Facility (SCF) is used to provide financial support to low-income countries that are experiencing short-term balance of payments difficulties. The SCF has replaced the high access component of the External Shock Financing Facility (ESF) and can be used in a wide range of circumstances, including as a precautionary measure. SCF financing currently carries a zero interest rate, with a grace period of 4 years and a full repayment period of 8 years.
The Rapid Credit Facility (RCF) provides rapid financial assistance with limited conditions and is intended for low-income countries facing urgent balance of payments needs. The introduction of the RCF streamlines IMF emergency assistance to low-income countries and can be used flexibly in a wide range of circumstances. Financing under the RCF is currently carried out at a zero interest rate, with a grace period of 5.5 years and a full repayment period of 10 years.
Sources of IMF financial resources
The main source of financial resources of the IMF are the quotas of the organization's member states, which generally reflect the relative position of member states in the world economy. In addition, the IMF may resort to temporary borrowing to supplement its quota resources, allowing the Fund to provide exceptional financial support to its members during a global economic crisis. Financing of concessional loans and debt relief for low-income countries is provided through separate trust funds, the funds of which come from contributions. The IMF issues international reserve assets known as special drawing rights (SDRs), which can complement member countries' official reserves. SDRs are the unit of account of the IMF. IMF member countries can voluntarily exchange SDRs for currencies among themselves.
Quota system:
Quota contributions are the IMF's most important source of financial resources. Each IMF member country is assigned a quota that generally reflects its relative size in the world economy. This parameter determines the maximum size of the government's contribution to the IMF's financial resources. When a country joins the IMF, it is assigned an initial quota in the same range as the quotas of existing member countries that are generally comparable to it in terms of economic size and characteristics.
The current quota formula is a weighted average (with a weight of 50 percent), openness (30 percent), economic volatility (15 percent) and international reserves (5 percent). A member state's quota determines its financial and organizational relationship with the IMF, including its access to financing (access limit). For example, under stand-by and extended lending arrangements, a member state can borrow up to 200 percent of its quota annually and up to 600 percent on a cumulative basis. However, in exceptional cases, access sizes may be increased. After joining the IMF, a country typically contributes up to one-quarter of its quota in the form of commonly accepted foreign currencies (such as the US dollar, euro, yen or pound sterling) or SDRs. The remaining three quarters are paid in the country's national currency.
The size of quotas is reviewed at least once every five years. Any changes to quotas must be approved by a majority of 85 percent of the total votes, and a member state's quota cannot be changed without its consent. In recent years, the quota and voting rights reform program has implemented special quota increases that have strengthened the representation of high-growth economies, many of which are emerging markets, through special quota increases for 54 member states. They also expanded the voting rights and participation of low-income countries by nearly tripling the number of basic votes. As a result, the volume of IMF quota resources has increased significantly.
Gold holdings:
Gold played a leading role in the international monetary and financial system until the collapse of the Bretton Woods system of fixed exchange rates in 1973. In the subsequent period, the role of gold gradually decreased. However, it still remains an important asset in the reserve holdings of a number of countries, and the IMF is the third largest official holder of gold in the world. The IMF's gold holdings amount to approximately 90.5 million troy ounces (2,814.1 metric tons). The Fund acquired its current gold holdings through four main types of transactions:
- When the IMF was established in 1944, it was decided that 25 percent of the initial quota contributions and subsequent quota increases would be paid in gold. These receipts were the IMF's largest source of gold.
- All payments of fees (interest on the use of IMF loans by member countries) are usually made in gold.
- A member state wishing to purchase the currency of another member state could obtain it by selling gold to the IMF. This provision was mainly used in the sale of gold to the IMF South Africa in 1970–1971.
- Member countries could also use gold to repay earlier IMF loans to them.
The IMF's articles of agreement severely limit the use of this gold. Subject to approval by a majority of 85 percent of the total voting rights of member countries, the IMF may sell gold or accept gold as payment from member countries, but the Fund is prohibited from purchasing gold or engaging in other transactions in gold.
There have been several occasions during the IMF's existence when the Fund voted to return gold to member countries or to sell part of its holdings. The reasons varied: between 1957 and 1970, the IMF sold gold several times to replenish its foreign exchange holdings. Around the same period, in order to generate income to cover operating deficits, part of the IMF's gold was sold to the United States, and the proceeds from the sale were invested in US government securities. In December 1999, the IMF Executive Board authorized up to 14 million ounces of off-market gold transactions to finance the IMF's participation in the Heavily Indebted Poor Countries Initiative. In September 2009, the IMF Executive Board approved the sale of 403.3 metric tons of gold, approximately one-eighth of the Fund's total gold holdings. Limited gold sales were conducted during 2009–2010 with strong safeguards to avoid market disruption, and all gold sales, including direct sales to interested central banks and other official holders, were made at market prices. Profits from the sale of SDR gold to the IMF, amounting to SDR 4.4 billion, were used to create an endowment fund, one component of the IMF's new revenue model, designed to put the institution's funding on a sustainable footing. Part of the proceeds from gold sales is used for concessional lending to low-income countries that meet the criteria for assistance.
IMF lending potential:
The IMF can allocate holdings received against quotas in the national currencies of countries characterized by strong financial situation, to finance lending. The IMF Executive Board selects such currencies every three months. The issuers of most of these currencies are industrial the developed countries, however, the list of currencies also included the currencies of countries such as Botswana, China and India. The IMF's holdings of these currencies, along with its own holdings of SDRs, constitute the IMF's own usable resources. If necessary, the IMF may borrow funds on a temporary basis to replenish these resources.
The amount available to the IMF to immediately provide new (non-concessional) loans provides an indication of its potential for future commitments. This potential is determined by the Fund's available usable resources (including unused amounts under borrowing and note purchase agreements) and amounts available under two standing multilateral borrowing agreements, plus projected loan repayments over the coming twelve months, net of resources. , which the Fund has already promised to provide in accordance with existing loan agreements, and the prudential balance.
Loan agreements:
Borrowing agreements provide the IMF with additional resources and are the main insurance instrument in case of insufficient resources under quotas. The IMF has two standing multilateral borrowing agreements - the expanded New Arrangements to Borrow (NAB) and the General Agreements on Borrowings (GAB), under which it can currently borrow SDR 370 billion (approximately US$559 billion) . The IMF can trigger these agreements if it considers that its resources in the form of quotas may not be sufficient to meet the needs of member countries, for example in the event of a severe financial crisis.
Trust funds:
IMF financial assistance to low-income countries comes in two main forms: low-interest loans through the Poverty Reduction and Growth Trust and debt relief through the Heavily Indebted Poor Countries Initiative, the Debt Relief Initiative. multilaterally and post-disaster debt relief. These resources come from contributions from member countries and the IMF itself, rather than from quota contributions.
The Poverty Reduction and Growth Trust Fund was created to provide debt relief and subsidize loan rates under the program. The resources available for this trust fund consist of grants and deposits pledged by the IMF's 93 member countries, as well as contributions from the Fund itself. The bulk of IMF contributions come from off-market gold transactions conducted during 1999–2000.
Debt relief was provided through the MDRI-I and MDRI-II trust funds, which were established in early 2006 and financed from the IMF's own resources of SDR 1.5 billion in the Special Disbursements Account. The MDRI-I Trust Fund provided debt relief to countries with per capita incomes of US$380 per year or less (based on 2004 gross national income). The MDRI II Trust Fund provided debt relief to countries with per capita incomes above US$380 per year and was funded by SDR 1.12 billion in bilateral resources from the Poverty Reduction and Assistance Trust Fund. economic growth.
The Disaster Debt Relief Trust Fund was created in June 2010 to relieve the debt burden of countries affected by disasters and was initially financed from the IMF's own resources of SDR 280 million (equivalent to approximately US$422 million). It is expected to be replenished by future donor contributions as needed.
IMF was conceived in early July 1944 at an international conference held in Bretton Woods, New Hampshire, United States, at which participants from 44 countries agreed on a framework for financial cooperation designed to prevent a repetition of the disastrous financial policies that had become one from the circumstances of the Famous Depression of the 1930s. Any member of the organization characterized the gold content of its own currency and, on this basis, noted the exchange rate in the currencies of other participating countries. Exchange rate shocks were allowed around 10%. Initially, the IMF provided mainly short-term loans to settle the balance of payments of participating countries.
On July 22, 1944, the basis of the agreement (IMF Charter) was developed. More significant contributors to the study of the IMF concept were John Maynard Keynes, who headed the British delegation, and Harry Dexter White, a senior official at the United States Treasury Department. The final version of the agreement was signed by the first 29 countries on December 27, 1945 - the official date of the creation of the IMF. The IMF began its own activities on March 1, 1947, as part of the Bretton Woods system. In the same year, France took out its first loan from the IMF.
The IMF now functions as an observer of global currencies, helping to maintain an orderly system of payments among all countries, and reducing cash flows to member countries with large balance-of-payments deficits. If the World Bank finances as a policy reform, then the International Monetary Fund deals only with reforms. It provides loans to member states that have short-term problems with international creditors, and strives to achieve absolute convertibility (independent transfer of one currency into another) of member states' currencies through a system of flexible exchange rates, operating since 1973. The IMF's proposals and resources can be used by all member states of this organization (both rich and poor).
Objectives of the IMF:
Assistance to international cooperation in the monetary sphere;
Help to expand the balanced growth of international trade and, in accordance with this, increase employment and improve the financial characteristics of member countries;
Determination of parities and exchange rates; prevent the ability to provide competitive currencies;
Ensuring the functioning of the international monetary systems by harmonizing and coordinating monetary policy and strengthening monetary rates and convertibility of the currencies of member countries; ensuring orderly relationships in the monetary field between member countries;
Offer assistance in creating a multilateral system of payments for current transactions between member countries and in eliminating monetary restrictions;
Offering support to member countries by providing loans and credits in foreign currency to settle balances of payments and stabilize monetary rates;
Providing advice on economic and monetary issues;
Reducing the duration and reducing the level of imbalance in the international balances of payments of member countries;
Monitoring compliance by member countries with the code of conduct in international monetary relations.
IMF definition
International Monetary Fund, IMF- an international organization created to regulate monetary and credit relations between member states and offer them monetary support in case of financial difficulties caused by a lack of balance of payments, by providing short- and medium-term loans in foreign currency. The Foundation has the status of a special UN agency. In fact, it works as the institutional basis of the world monetary system.
The headquarters of the IMF is in Washington, DC. The IMF also has its own consulates in more than 80 countries around the world, which demonstrates its large-scale nature and close relationships with member countries. The Fund's economic year runs from May 1 to April 30.
The IMF has a unit of account - the Special Drawing Right (SDR). The SDR rate to the United States dollar on March 2, 2013 was 1.5149 United States dollars. The conversion of these IMF funds into American dollars is approximate and is provided for convenience.
A low exchange rate was observed at the beginning of January 2002, 1.24 United States dollars per 1 SDR, and limit value at the beginning of March 2008, 1.64, was actually associated with the financial and economic decline, which manifested itself in the form of a powerful shift for the worse in all key financial indicators in many developed countries, and then a large-scale decline occurred at the end of the same year.
For 25 years, the Russian Federation has been a member of the International Monetary Fund (IMF). On June 1, 1992, Russia became part of one of the largest financial organizations in the world.
During this time, Russia has gone from a borrower, which received approximately $22 billion from the IMF, to a creditor.
The history of the relationship between Russia and the IMF is in the TASS material.
What is International currency board? When did it appear and who is included in it?
The official date of creation of the IMF is December 27, 1945. On this day, the first 29 states signed the IMF Charter, the main document of the fund. The organization's website states the main purpose of its existence: ensuring the stability of the international monetary system, that is, the system of exchange rates and international payments that allows countries and their citizens to conduct transactions with each other.
Today the IMF includes 189 countries.On what principles does the IMF operate?
The Foundation performs many functions. For example, he watching the state of the international monetary and financial system both globally and in each specific country. In addition, employees The IMF advises countries members of the organization. Another function of the fund is lending to countries with significant economic problems.
Each IMF member country has its own quota, which affects the size of contributions, the number of “votes” in decision-making and access to financing. The current IMF quota formula consists of four components: gross domestic product, economic openness and volatility, and a country's international reserves.
Each participating state makes contributions to the fund in certain currency proportions - a quarter to choose from in one of the following currencies: US dollar, euro (until 2003 - mark and French franc), Japanese yen, Chinese yuan and pound sterling. The remaining three quarters are in national currency.
Since IMF member countries have different currencies, since 1972, for general convenience, the fund's finances have been converted into a domestic means of payment, it is called SDR ("special drawing rights"). It is in SDR that the IMF conducts all calculations and issues loans, and only by “bank transfer” - there are no SDR coins or banknotes and never have been. The rate is floating: as of June 1, 1 SDR was equal to $1.38, or 78.4 rubles.
However, at the time of Russia's accession to the IMF, a curious situation arose. Our country in 1992 did not have the opportunity to contribute its share of foreign currency. The problem was solved in an original way - the country took out an interest-free loan for one day from the USA, Germany, France and Japan in the currencies of these countries, made its contribution to the IMF and immediately asked for its “reserve share” (a loan in the amount of a quarter of the quota that the member country has the right to ask the fund at any time for foreign currency). After which she returned the funds provided.How big is the Russian quota in the modern IMF?
Russia's quota is 2.7% - 12,903 million SDR ($17,677 million, or almost a trillion rubles).
Why was the Soviet Union not a member of the IMF?
Some experts believe that this was a miscalculation of the USSR leadership. For example, the current doyen of the fund’s Board of Directors (IMF term, literally translated as “elder”), Alexei Mozhin, told TASS that the Soviet delegation participated in the Bretton Woods Conference, at which the IMF Charter was developed. Its participants appealed to the leadership of the Soviet Union with a recommendation to join the IMF, but the then People's Commissar for Foreign Affairs Vyacheslav Molotov wrote a refusal resolution. According to Mozhin, the reason was the peculiarities of the Soviet economy, different statistics and the reluctance of the authorities to issue foreign countries some economic data, for example the size of gold and foreign exchange reserves.
Chief Researcher at the Institute of World Economy and international relations Dmitry Smyslov, author of the book “The History of Russia’s Relations with International Financial Organizations,” gives another explanation: “Dogmatic ideological stereotypes that were inherent in the former political leadership of the USSR.”Why did Russia start borrowing money from the fund?
After the collapse of the Soviet Union, multibillion-dollar debts remained, which were liquidated only this year. According to various sources, they ranged from 65 to 140 billion dollars. Initially, it was planned that 12 republics of the former Union (except for the Baltic countries) would issue loans. However, at the end of 1992, Russian President (1991-1999) Boris Yeltsin signed a “zero option” agreement, in which the Russian Federation agreed to pay the debts of all republics of the USSR, and in return received the right to all the assets of the former Union.
The IMF and the United States (as the holder of the largest quota in the fund) welcomed this decision (according to one version, because other republics simply refused to repay the loans and in 1992 only Russia repaid the money). Moreover, according to Smyslov, the IMF almost made the signing of the “zero option” a condition for joining the fund.
The fund made it possible to receive funds for long periods and at very low interest rates (in 1992 the rate was 6.6% per annum and since then it has been steadily decreasing). Thus, Russia “refinanced” its debts to the creditors of the USSR: their “interest rate” was significantly higher. The other side of the coin was the demands that the IMF placed on Russia.
And how much did we receive from the fund?
There are two numbers. The first of them is the size of approved loans, it amounts to 25.8 billion SDR. However, in fact, Russia received only 15.6 billion SDR. This significant difference is explained by the fact that loans are issued in installments and with certain conditions. If, in the opinion of the IMF, Russia did not comply with them, further tranches simply did not arrive.
For example, at the end of 1992, Russia was supposed to ensure a reduction in the budget deficit to 5% of GDP. But it turned out to be twice as high, and therefore the tranche was not sent. In 1993, the IMF was supposed to issue a loan of more than 1 billion SDR, but its leadership was not satisfied with the results of the financial and macroeconomic stabilization carried out in Russia. For this reason, as well as due to changes in the composition of the Russian government, the second half of the loan was never provided in 1993. Finally, in 1998, Russia defaulted, and therefore more than $10 billion in financial assistance was not provided. In 1999-2000, the IMF was supposed to lend about $4.5 billion, but transferred only the first tranche. Lending stopped at Russia's initiative— the price of oil rose, in 2000 the political situation in the country changed significantly and the need to go into debt disappeared. After that, Russia repaid the loans until 2005. Since then, our country has not borrowed funds from the IMF.
In any case, Russia was the IMF's largest borrower, and, for example, in 1998 the number of loans issued exceeded the quota by more than three times.
What was this money spent on?
There is no clear answer. Some of them went to strengthen the ruble, and some went to the Russian budget. A lot of money from IMF loans went to repay the USSR’s external debt to other creditors, including the London and Paris Clubs.Did the IMF help only with money?
No. The Fund provided assistance to Russia and other post-Soviet countries complex of expert and consulting services. This was especially relevant immediately after the collapse of the USSR, since at that time Russia and other republics did not yet know how to effectively manage a market economy. According to Alexey Mozhin, the fund played a decisive, key role in the creation of the treasury system in Russia. In addition, relations with the IMF helped Russia obtain other loans, including from commercial banks and organizations.What is Russia's relationship with the IMF now?
“Russia participates in financing our efforts - be it in African countries, where we now have many programs, or in some European countries where we work. And the money will return to it, with interest,” is how the IMF Managing Director described the role of our country Christine Lagarde in an interview with TASS.
In turn, Russia periodically holds consultations with the IMF on all aspects of the economic situation in our country and economic development.
Sergey Kruglov
P.S. Bretton Woods. July 1944. It was here that the bankers of the Anglo-Saxon world finally built a very strange and counterintuitive financial system, the inevitable decline of which we are witnessing today. Why inevitable? Because the system invented by the bankers contrary to the laws of nature. In the world, nothing disappears into nowhere or appears out of nothing. The law of conservation of energy operates in nature. And the bankers decided to violate the fundamental principles of existence. Money out of thin air, wealth out of nothing, without labor - this is the quickest path to degradation and degeneration. This is exactly what we are seeing today.
Great Britain and the USA actively directed events in the direction they needed. After all, a new world could only be built... on the bones of the old. And that’s why it was needed World War. According to its results, the dollar was to become the world reserve currency. This problem was solved through the Second World War and tens of millions of deaths. This is the only way the Europeans agreed to part with their sovereignty, an integral feature of which is the issuance of its own currency.
But the Anglo-Saxons were seriously planning to launch a nuclear strike on Russia-USSR if Stalin did not agree to “surrender” their financial independence. In December 1945, Stalin had the courage not to ratify the Bretton Woods agreements. An arms race will begin in 1949.
The struggle ensues because Stalin refused to surrender state sovereignty to Russia. Yeltsin and Gorbachev will hand him over together.
The main outcome of Bretton Woods was cloning the American financial system for the whole world, with the creation in each country of a branch of the Federal Reserve System, subordinate to the world behind the scenes, and not to the government of that country.
This structure is pocket-sized and manageable for the Anglo-Saxons.
It is not the IMF itself, but the US government that decides what and how the International Monetary Fund should decide. Why? Because the United States has a “controlling stake” in the IMF votes, which was determined during its creation. And “independent” central banks are precisely part of the International Monetary Fund and comply with the norms of this organization. Under the film beautiful words about the stability of the world economy, about the desire to avoid crises and cataclysms, there was hidden a structure designed to tie the whole world to the dollar and pound once and for all.
IMF employees are not subject to the jurisdiction of anyone in the world, and they themselves have the right to demand any information.
You can't refuse them.
Straight to prea On the side of the IMF charter is the inscription: “International Monetary Fund. Washington, DC, USA"
Author: N.V. Old people
The International Monetary Fund (IMF) is an intergovernmental monetary organization with the status of a specialized agency of the UN. The purpose of the fund is to promote international monetary cooperation and trade, coordinate the monetary and financial policies of member countries, provide them with loans to settle balances of payments and maintain exchange rates.
The decision to create the IMF was made by 44 countries at a conference on monetary and financial issues held in Bretton Woods (USA) from July 1 to July 22, 1944. On December 27, 1945, 29 states signed the foundation's charter. The authorized capital amounted to $7.6 billion. The IMF began its first financial operations on March 1, 1947.
There are 184 countries that are members of the IMF.
The IMF has the authority to create and provide international financial reserves to its members in the form of “Special Drawing Rights” (SDRs). SDR is a system for providing mutual loans in conventional monetary units - SDR, equal in gold content to the US dollar.
The fund's financial resources are generated primarily through subscriptions (“quotas”) from IMF member countries, the total amount of which currently amounts to about $293 billion. Quotas are determined based on the relative size of the economies of member states.
The IMF's main financial role is to provide short-term loans. Unlike the World Bank, which provides loans to poor countries, the IMF lends only to its member countries. Fund loans are provided through normal channels to member states in the form of tranches, or shares, representing 25% of the relevant member state's quota.
Russia signed an agreement to join the IMF as an associate member on October 5, 1991, and on June 1, 1992, officially became the 165th member of the IMF by signing the Fund's Charter.
On January 31, 2005, Russia fully repaid its debt to the International Monetary Fund, making a payment in the amount of 2.19 billion special drawing rights (SDR), which is equivalent to $3.33 billion. Thus, Russia saved $204 million, which it had to pay if the debt to the IMF was repaid according to the schedule before 2008.
The highest governing body of the IMF is the Board of Governors, in which all member countries are represented. The Council holds its meetings annually.
Day-to-day operations are led by an Executive Board of 24 executive directors. The IMF's five largest shareholders (USA, UK, Germany, France and Japan), as well as Russia, China and Saudi Arabia, have their own seats on the Board. The remaining 16 executive directors are elected for two-year terms by country groups.
The Executive Board elects a Managing Director. The Managing Director is the Chairman of the Board and Chief of Staff of the IMF. He is appointed for a five-year term with the possibility of re-election.
According to the existing agreement between the United States and EU countries, the IMF is traditionally headed by Western European economists, while the chairman of the World Bank is chosen by the United States. Since 2007, the procedure for nominating candidates has been changed - any of the 24 members of the board of directors has the opportunity to nominate a candidate for the post of managing director, and he can be from any member country of the fund.
The first managing director of the IMF was Camille Goutte, a Belgian economist and politician, former finance minister, who headed the Fund from May 1946 to May 1951.
In November 2007, the IMF was headed by the Frenchman Dominique Strauss-Kahn.
On May 19, 2011, it became known that Strauss-Kahn informed the organization’s management of his intention to leave his post in connection with the ongoing criminal investigation against him. Dominique Strauss-Kahn was detained on May 14 in New York on board a plane 10 minutes before departure to Paris based on a statement from a maid at the Sofitel hotel near Times Square, who contacted the police with a complaint of sexual assault by a high-ranking guest.
Until the election of a new head of the fund, First Deputy Head of the IMF John Lipsky will serve as interim head of the IMF.
The material was prepared based on information from open sources
The International Monetary Fund is the most influential international organization regulating international macroeconomics.
Initially, the Fund lent primarily to Western countries. In the mid-70s. industrialized and developing countries received approximately equal amounts from it, and since the 1980s the IMF has switched almost entirely to lending to the latter.
The IMF monitors and controls compliance by member countries with its Charter, which sets out the basic structural principles of the world monetary system.
No other international organization has been so harshly criticized by developing countries like the IMF. The Fund has a strong impact on socio-economic processes in these regions, especially in the context of the debt crisis. However, without the Fund's active intervention in the debt crisis, its consequences for developing countries and the global credit system would have been much more serious.
In the first part of this test work The main areas of activity and goals of the International Monetary Fund, as well as the procedure for joining and participating in the IMF are presented. The second part reveals the structure and functions of the IMF. The third part examines the features of the IMF's credit policy and the main mechanisms for lending to participating countries.
At the end of the work, conclusions are drawn.
1. Main activities and tasks of the International Monetary Fund
International Monetary Fund, IMF (InternationalMonetaryFund,IMF) - an intergovernmental organization designed to regulate monetary relations between member states and provide them with financial assistance in case of currency difficulties caused by balance of payments deficits by providing short- and medium-term loans in foreign currency. The Fund, a specialized agency of the UN, practically serves as the institutional basis of the world monetary system.
The IMF was established at the UN International Monetary and Financial Conference, held from July 1 to July 22, 1944 in Bretton Woods (USA, New Hampshire). The conference adopted the Articles of Agreement for the IMF, which is its Charter and entered into force on December 27, 1945; The Foundation began its practical activities on March 1, 1947.
In connection with the evolution of the world monetary system, the IMF Charter was revised three times:
In 1969, with the introduction of the SDR system; HAPPY BIRTHDAY- international payment and reserve funds issued by the IMF and used for non-cash international payments through entries in special accounts and as the IMF unit of account;
In 1976, with the creation of the Jamaican Monetary System;
In November 1992, with the inclusion of sanctions - suspension of the right to participate in voting - in relation to countries that have not repaid their debts to the Fund.
As of February 15, 1999, 182 states were members of the IMF (Appendix 1), i.e. most countries of the world. Switzerland remained outside the Fund for a long time, but in 1992 it joined the IMF. In the early 1990s, most former socialist countries, as well as China and Vietnam, became its members. Russia joined the IMF on July 1, 1992.
Each IMF member has a quota, calculated based on the relative economic and financial strength of the country. Quotas determine the size of financial contributions (subscriptions) of each member country, the number of votes assigned to it and the conditions for its access to the resources of the Fund. The quota is equal to 250 "basic" votes, which are allocated to each country participating in the Fund plus 1 vote for every 1,000,000 SDRs. A participating country is required to pay 25% of its subscription in SDRs or in the currencies of other participating countries, as determined by the IMF, according to the charter; The country pays the rest in its own currency.
As of January 31, 2003, the US share in the total resources of the IMF exceeded 18% (which gave this country the actual opportunity to veto any decision relating to the management of the Fund, the adoption of which requires at least 85% of all votes), Germany - 5.53%; Japan - 5.53%; Great Britain - 4.98%; France - 4.98%; Saudi Arabia - 3.45%; Italy - 3.09%; Russia - 2.90%. The share of 15 EU member countries is 28.8%, 29 industrialized countries (member countries of the Organization for Economic Cooperation and Development, OECD) have a combined 63.4% of votes in the IMF. The remaining countries, which make up over 84% of the Fund's members, account for only 36.6% of the votes. Subscription fees were initially paid partly in gold and partly in the national currency of the member country. For early members of the IMF, the contribution, payable in gold, was 25% of the quota, or 10% of the country's net official gold and dollar reserves as of September 12, 1946, whichever was less. The size of membership fees for countries that joined the IMF after 1948 was determined individually. In 1978, after gold ceased to play any role in IMF operations, the Fund began to gradually divest itself of gold. Currently, 25% of member countries' contributions are paid in freely convertible currencies, the remaining 75% are still in national currency. The contribution, payable in local currency, can be made in the form of interest-free bonds of the government concerned, which the IMF can call in cash if necessary. As of January 1, 2004, membership fees amounting to total amount quotas in the IMF reached 145.4 billion SDR, or almost 215 billion dollars at the current exchange rate.
Initially, quotas for IMF member countries were determined, but not directly, according to the Bretton Woods formula. The main variables of this formula were such indicators as annual imports and exports, gold reserves and dollar balances, and national income. These indicators served as the basis for calculating quotas until the 60s. In 1963, the Bretton Woods formula was revised and new formulas were added.
Taken together, they were used as aids in determining the initial quotas of new members and increasing the quotas of old members. These formulas combine economic indicators, described above, as well as current income, current expenses, as well as indicators related to exports and imports.
In the early eighties, the IMF simplified quota calculation procedures and improved the economic data used in the formulas.
When a country is about to become a member of the IMF, the fund’s staff calculates a quota for it and compares the result obtained with the quotas of countries already in the Fund with similar economic characteristics. The resulting quota value is discussed by the Membership Committee of the Executive Council. After a country intending to join the Fund agrees to the terms of the membership agreement, the Executive Council (as a whole) prepares a resolution for the Board of Governors. Once all formal steps are completed, the country represented is invited to Washington to sign the Articles of Agreement.
The goals of the International Monetary Fund include the following:
Promoting international monetary cooperation through consultation and interaction on currency issues;
Promoting the expansion and balanced growth of international trade and, accordingly, the growth of employment and economic improvement of member countries;
Ensuring the functioning of the international monetary system by harmonizing and coordinating monetary policy and maintaining exchange rates and convertibility of the currencies of member countries; ensure orderly relations in the monetary field between member countries;
Determination of parities and exchange rates; prevent competitive currencies;
Assisting in the establishment of a multilateral system of payments for current transactions between member countries and in the elimination of foreign exchange restrictions;
Providing assistance to member countries by providing loans and credits in foreign currencies to settle balances of payments and stabilize exchange rates;
Reducing the duration and reducing the degree of imbalance in the international balances of payments of member countries;
Providing advisory assistance on financial and monetary issues to member countries;
Monitoring compliance by member countries with the code of conduct in international monetary relations.
2. Structure and functions of the IMF
Management at the IMF is carried out in accordance with the Articles of Agreement. The management structure of the IMF includes the Board of Governors, the Interim Committee, the Development Committee, the Executive Council, the IMF Committee on Balance of Payments Statistics, and the Manager (Managing Director).
Board of Governors - The highest governing body of the IMF, in which each member country is represented by a governor and a deputy governor, appointed for five years. These are usually finance ministers or central bankers. The Board of Governors usually meets in session once a year, but may meet or pass resolutions by postal vote or more frequently. The Council is responsible for resolving key issues of the Fund’s activities, such as amending the Articles of Agreement, admitting and expelling member countries, determining and revising the value of their shares in the capital, and electing executive directors. Decisions in the Board of Governors are usually made by a simple majority (at least half) of votes, and by the most important issues of an operational or strategic nature - by a “special majority” (70% or 85% of the votes of the member countries, respectively). The Board of Governors may delegate any of its functions to the Executive Board.
Interim Committee implements decisions of the Executive Council. Consists of 24 IMF governors, ministers, or other officials of comparable rank. The Temporary Committee meets twice a year and reports to the Board of Governors on the management and functioning of the international monetary system, and also makes proposals for changes to the Articles of Agreement.
Development Committee just as the Interim Committee consists of 24 IMF Governors, ministers, or other officials of comparable rank, makes recommendations and reports to the IMF Board of Governors. The Development Committee meets jointly with the Interim Committee to prepare reports and provide advice on all aspects of real resource transfer.
The Board of Governors delegates most of its powers Executive Council, i.e. directorate, which is responsible for the conduct of the affairs of the IMF, which includes a wide range of policy, operational and administrative issues, in particular the provision of loans to member countries and the supervision of their exchange rate policies. The Executive Board resides permanently at the Foundation's headquarters in Washington and typically meets three times a week. The Executive Council is responsible for a wide range of administrative and operational issues, and also deals with issues related to the Fund's policies in relation to member countries. Since 1992, the number of executive directors has been increased to 24. Five of them were appointed, according to the charter, by the USA, Germany, Japan, Great Britain and France, i.e. the five countries that have the largest quotas in IMF capital; 3 - formally elected, but each representing one country - Saudi Arabia, Russia and China; 16 - elected from the remaining member countries, divided into a corresponding number of groups, formed taking into account the principle of geographical representation or on the basis of common interests. Appointments and elections of executive directors are held every two years. The director has the number of votes that the directors who elected him collectively have. In most cases, decisions in the Executive Council are made not by formal voting, but by prior consensus among its members.
IMF Committee on Balance of Payments Statistics, which includes representatives from industrialized and developing countries, develops recommendations for more widespread use statistical data in the compilation of balances of payments, coordinates the implementation of basic statistical surveys of portfolio investments and carries out studies to record flows associated with derivative funds.
Manager (director - managing director). Elected by the Executive Board, the IMF Governor chairs the Executive Board and is the organization's chief of staff. Under the direction of the Executive Board, the Governor is responsible for the day-to-day operations of the IMF. The manager is appointed for five years and may be re-elected for a subsequent term. The Managing Director presides over the Directorate (without the right to vote, except in cases where the votes are equally divided) and heads the administrative apparatus of the fund.
The functions of the Managing Director include the management of day-to-day affairs and the appointment of IMF officials: his deputy, secretary, treasurer, heads of departments, general counsel of the legal department, heads of administrative services and the headquarters of the fund.
The IMF's activities are based on a monetary approach to regulation economic activity, which is achieved through the organization performing the following main functions:
Supervision - function of the IMF, which provides for its right to monitor the policies of member countries in the field of setting exchange rates and related macroeconomic policies. Each country is required to provide the IMF, upon request, with information necessary for the supervision of its economic policies. It usually consists of detailed information on the real monetary, fiscal and external sectors, as well as on government structural policies (privatization, labor market, environment). The main goal of supervision is to promptly identify potentially dangerous macroeconomic imbalances that could affect the stability of exchange rates, and, using the best international experience, provide the government with recommendations for correcting them.
Financial aid- the use of IMF financial resources by member countries that are experiencing difficulties in financing the balance of payments and have submitted to the IMF a reform program showing the government’s intentions to overcome these difficulties. The IMF's financial resources consist of its own resources (each country's contribution to the IMF's authorized capital in accordance with the quota), interest income for the use of IMF resources, as well as a number of borrowed funds. An IMF loan represents the purchase of foreign currency for national currency; loan repayment - reverse exchange. IMF loans are issued in shares ( in tranches). The use of IMF financial resources provides for their allocation in parts as the country implements the economic reform program agreed with the IMF. Loan tranches (starting from the second) can be received only if the criteria established in this program are met. This property of IMF tranches is called conditionality of financing. All types of access to IMF financial resources are based on countries' fulfillment of certain conditions, which are developed jointly by IMF experts and the country's government as part of an economic reform program aimed at overcoming balance of payments difficulties.
Technical assistance - IMF assistance to member countries in the field of monetary, exchange rate policy and banking supervision, budget and tax policy, statistics, development of financial and economic legislation and personnel training. Technical assistance is provided through sending missions to central banks and ministries of finance and statistical bodies of countries that have requested such assistance, sending experts to these bodies for 2-3 years, and conducting an examination of legislative documents being prepared.
Issue of Special Drawing Rights - international reserve assets created by the IMF in 1969 and periodically distributed among member countries in proportion to their IMF quotas. In the international economy, SDRs, accounting for approximately 2% of world reserves, serve as 1) international reserves along with gold and foreign currencies, 2) a unit of account that is used by the IMF and some other international organizations,
3) currencies that fix exchange rates in some countries,
4) denominator of a number of private financial instruments.
3. IMF lending activities
The Fund’s Charter uses two concepts to identify its lending activities:
1) transaction (transaction) - provision of foreign currency to countries from its resources: 2) operation (operation) - provision of intermediary financial and technical services using borrowed funds. The IMF carries out lending operations only with official bodies - treasuries, central banks , stabilization funds.
There are different types of loans to cover the balance of payments deficit and to support the structural adjustment of economic policy with T wound members.
In practice, the Fund receives loan requests primarily from countries with non-convertible currencies. As a result, the IMF, as a rule, provides foreign currency loans to member states as if “secured” by the corresponding amounts of non-convertible national currencies.
The IMF charges borrowing countries a one-time commission fee of 0.5% of the transaction amount and a certain charge, or interest rate, for the loans it provides, which is based on market rates. After a specified period of time, the member country is obliged to carry out the reverse operation - to buy back the national currency from the Fund , returning the funds to him HAPPY BIRTHDAY or foreign currencies.
Re agreements h ervnoy credit, or with O sayings " stand-by " provide the member country with a guarantee that it will be able to receive foreign currency from the IMF in exchange for national currency in accordance with the agreement at any time, provided that the country complies with the agreed conditions.
The basis for a country's request to the IMF for a loan under the Extended Credit Facility may be a serious balance of payments imbalance caused by structural disturbances in production, trade, or the price mechanism.
In order to expand its credit h opportunities, the IMF practices the creation of special funds (eng. faci l ity - device, mechanism, fund). They differ in the purposes, conditions and cost of the loan.
1. Compensatory and Contingency Loan Fund intended for lending to IMF member countries whose balance of payments deficit is due to external factors beyond their control. These include: natural disasters, an unexpected drop in world prices, industrial decline and the introduction of protectionist restrictions in importing countries, the emergence of substitute goods, etc.
2. Created in June 1969 Buffer (Reserve) Stock Lending Fund to assist countries involved in establishing such commodity stockpiles in accordance with international agreements, if it worsens their balance of payments.
3. Operating since 1989 Fund for financial support of operations to reduce and service external debt. This is explained by the active role of the IMF in resolving the debt crisis of developing countries in the 80s.
4. In April 1993, the IMF established Structural Change Support Fund. This fund is aimed at countries undergoing the transition to market economy through radical economic and political reforms.
In addition to the currently functioning four special funds, the IMF periodically creates temporary credit funds in order to solve acute problems of international monetary relations. To form them, borrowed funds are attracted from various external official sources. Temporary special funds include:
1) Oil Fund in the amount of 6.9 billion. HAPPY BIRTHDAY, or 8 billion dollars (1974-1976). provided loans to IMF member countries to cover additional costs caused by the increase in the cost of imports of oil and petroleum products. The resources needed for this were lent primarily by oil exporting countries. Developing countries quantitatively predominated among recipients of loans, but their share was small (1/3) compared to developed countries. The conditions for providing loans from the oil fund were strict: relatively high interest rates (at least 7.2% per annum); mandatory implementation of IMF recommendations when implementing national energy and monetary policy. As a result, developing countries’ access to the resources of the oil fund was limited: due to its cre ditov they covered only 1/3 of the additional costs of importing increased oil prices;
2) Trust Fund- in the amount of 4 billion. HAPPY BIRTHDAY, or 4.9 billion dollars (1976-1981); created mainly from profits from the sale at auctions of part of the IMF's gold reserves. The recipients of loans from this fund were the least developed countries. Us l The benefits of these loans were relatively preferential: the borrowing countries did not pay And whether the IMF has the equivalent of the funds received in national currency, the interest rate is low 0.5%, the loan term is 10 years. These conditions are at their greatest P They met the requirements of developing countries. 55 countries received SDR 3 billion from the trust fund. The rest was transferred to developing countries in proportion to their quotas.
3) Replenish the fund T individual lending or foundation Witteveen- named after the Managing Director of the IMF; duration 1979-1984 The purpose of this fund is to provide, through borrowed funds, additional loans with T wounds, is P those experiencing particularly severe and protracted balance of payments crises and having exhausted the limits of conventional IMF lending. The resources of the Witteveen Fund (SDR 7.8 billion, over $10 billion) were formed through loans 13 pages A n-members of the IMF, as well as the Swiss National Bank. Credit T 26 countries received funds from this fund.
4) IMF Extended Access Fund; successor to the additional lending fund, operated in 1981-1992. The purpose of the fund is to provide additional loans to member countries whose balance of payments imbalances are disproportionately large compared to the size of their quotas. This fund was used in cases where the country needed funds for large sizes than it could obtain from the IMF under the four lending shares and the extended lending system, and for a longer period to implement corrective economic measures with a longer loan repayment period. Is T The source of the fund's resources were the IMF's own funds, attracted in the form of subscriptions, and borrowings from other countries. Due to the increase in quota T member countries of the IMF, this fund ceased its activities in November 1992;
5) Background d structural P restructuring(since March 1986): P provides concessional loans to the poorest developing countries , experiencing a chronic balance of payments crisis in order to implement medium-term macroeconomic and structural adjustment programs. As of September 1993, 36 countries (out of 61 eligible countries) had received these concessional loans amounting to $1.5 billion. HAPPY BIRTHDAY, or about 2.1 billion dollars. Loan terms: 0.5% per annum: repayment within 10 years; t rational period up to 5"/2 years. Loan limit - up to 50% of the quota. Source of resources (SDR 2.7 billion) - repayment of loans provided by the trust fund;
6) Expanded Structural Adjustment Fund; since December 1987, it has been providing loans from both unused resources of the structural adjustment fund and special loans and donations (SDR 6 billion). In terms of its goals and functioning mechanism, this fund is the successor to the structural adjustment fund. In addition to the 61 countries, 11 more countries, including Albania and Mongolia, were granted the right to receive loans from this fund in April 1992. 29 countries had used this right by September 1993 in the amount of SDR 3.2 billion (actually 2.4 billion . HAPPY BIRTHDAY.) . A member country has the opportunity to receive these loans for a period of 3 years up to 190% of the quota, sometimes in exceptional circumstances up to 255% of the quota. Initially, the deadline for concluding loan agreements was set to November 1990; later it was extended several times (until February 28, 1994). At the end of 1993, a new expanded structural adjustment fund was formed - the successor to the previous one. The volume of the new fund is SDR 5 billion (about $7 billion) to provide preferential loans for a period of three years and SDR 2 billion (about $3 billion) to subsidize interest rates on these loans. By May 1994, 43 countries had agreed to participate in the formation of this fund. The economic restructuring programs that will be implemented with the assistance of the new fund will pay more attention to social protection of the population and improving the structure of government spending. The new expanded structural adjustment fund is valid until the end of 1996, and funds under the concluded agreements will be provided to borrowing countries until the end of 1999.
The formation of additional special funds within the IMF by borrowing resources from other member countries is one of the manifestations of the process of adapting the system of interstate lending and currency regulation to the changing conditions of the world economy. The IMF acts as an intermediary in the redistribution of loan capital from more prosperous creditor countries to countries , those in need of loans. Simultaneously , exerting a forceful influence on economic policy borrowing countries. He acts as a guarantor of the return of these funds.
Conclusion
Over the course of its existence, the IMF has become a truly universal organization , has achieved wide recognition as the main supranational body regulating international monetary relations, an authoritative center for international lending, a coordinator of interstate credit flows and a guarantor of solvency borrowing countries. At the same time he starts playing important role in the implementation of the decisions of the “seven” leading Western states, becomes a key link in the emerging system of regulation of the world economy, international coordination , harmonization of national macroeconomic policies. The Fund has established itself as an actively functioning global monetary institution and has accumulated extensive and useful experience.
Of course, like any international organization, the IMF is an arena not only of partnership, but also of competition between national, economic and political interests. The United States lost the ability to monopolize the Fund's policy. They are forced to coordinate their line of behavior with the main states Western Europe and Japan.
At the same time, the influence of developing countries in Asia, Africa and Latin America defending their interests. Former CMEA member countries are also beginning to actively declare themselves, especially Russia and other CIS countries. From this there is a need for a more effective mechanism for comparing, taking into account and reconciling conflicting interests within the IMF for the benefit of the entire world community, the need to improve both the institutional structures of the Fund and the policy programs it implements.
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Annex 1
List of IMF member states
| Australia Azerbaijan Antigua and Barbuda Argentina Afghanistan Bahamas Bangladesh Barbados Belarus Bulgaria Bosnia and Herzegovina Botswana Brazil Burkina Faso Great Britain Venezuela Guatemala Guinea-Bissau Germany Honduras Dominica | Dominican Republic Zimbabwe Indonesia Jordan Ireland Iceland Cape Verde Kazakhstan Cambodia Kiribati Colombia Comoros Costa Rica Ivory Coast Kyrgyzstan Liechtenstein Luxembourg Mauritius Mauritania Madagascar Macedonia Malaysia | Marshall Islands Mozambique Mongolia Netherlands Nicaragua New Zealand Norway Pakistan Papua New Guinea Paraguay Portugal The Republic of Korea Russian Federation Salvador San Marino Sao Tome and Principe Saudi Arabia Swaziland Seychelles Saint Vincent and the Grenadines Saint Kitts and Nevis Saint Lucia Singapore Slovakia | Slovenia United States of Micronesia Solomon islands Sierra Leone Tajikistan Tanzania Trinidad and Tobago Turkmenistan Uzbekistan Philippines Finland Croatia Central African Republic Switzerland Sri Lanka Equatorial Guinea |
Gerchikova I.G. "International economic organizations." / M.: Publishing house. JSC "Consultbanker" – 2003, p.354.
Gerchikova I.G. "International economic organizations." / M.: Publishing house. JSC "Consultbanker" – 2003, p. 358. Send a request indicating the topic right now to find out about the possibility of obtaining a consultation.
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