International Monetary Fund (IMF)

Question 1

How many members does IMF have?

Answer 1

190 member-states (almost global membership), last member Andorra joined in October 2020

Question 2

What is the IMF?

Answer 2

An IGO created to ensure stability of the international monetary system. Lends aid to states with balance-of-payments difficuties

Question 3

What does the IMF do?

Answer 3

Monitors the world economy - provides members with policy advice and loans
Loans - funded by contribution of members and attaches conditions

Question 4

What are the aims of the IMF?

Answer 4

1. Promote international monetary cooperation and exchange-rate stability
2. Facilitate expansion and balanced growth of international trade
3. Assist in establishment of multilateral system of payments
4. Make resources available to members experiencing balance-of-payments difficulties

Question 5

What are the 3 roles of the IMF?

Answer 5

1. Provide loans
2. Monitor economic policies
3. Offer technical assistance.

Question 6

What is the power of the IMF?

Answer 6

It can provide loans with conditions. Conditions challenge sovereignty as they may require foreign policy to change (Pakistan 2019, had to increase taxes and pay 37 bn of debt)

Question 7

How does the IMF challenge state sovereignty?

Answer 7

Is a direct threat to economic sovereignty. Capacity and willingnesss of a state to control its economy and related policies, flow of goods and services without intervention is lost
Pakistan July 2019 had to devalue currency to make exports cheaper

Question 8

How does the IMF impact states (power)?

Answer 8

If states do not meet policy reforms (loan conditions), funds can be withheld (Pakistan early 2023 could not meet conditions).
- IMF can control manner state addresses balance-of-payments problems

Question 9

What are criticisms of the IMF?

Answer 9

IMF imposes terms which impact the lives of those needing loans
- Pakistan 2019 citizens could not pay increased taxes from IMF loan conditions
Impacts ablity of state to exercise its sovereign right
Often leads states needing another loan, cannot get out of debt crisis (Pakistan has recieved 22 loans from the IMF (2023 recent)

Question 10

How is the IMF’s power limited

Answer 10

States do not have to accept loan conditions, but then do not recieve funds
Australia ignored IMF advice (need date)