INTERNATIONAL MONETARY FUND

The impetus for the creation of the IMF was provided by events which staggered the international economy from 1929 to the beginning of the Second World War (Horsefield, 1992, p. 5). Attempting to maintain domestic economic stability and retain international market positions during this time period, most countries engaged in competitive devaluations, foreign exchange controls, and import restrictions (Driscoll, 1994, p. 1). The disastrous consequences of these actions resulted in a near universal recognition of a need to establish some sort of mechanism through which international economic stability could be both created and maintained (Heller, 1993, p. 51).

Following international negotiation on such a mechanism during the period of the Second World War, the Bretton Woods Agreement of 1944 created the IMF (Driscoll, 1994, p. 2). The institution became a reality in December 1945, when the thirtieth nation signed the Agreement. Actual financial operations were commenced by the IMF in early1947 (Heller, 1993, p. 65).

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cted by oil price increases in meeting the interest payments on oil facility loans. 4. A Trust Fund was established in 1976, to both make direct distributions and to make loans to lowincome developing nations which are also members of the IMF. Resources for the Trust Fund are derived from sales of IMF gold holdings. 5. A supplemental financing facility was established in 1979 that permits increased access to IMF resources by member nations experiencing relatively (to gross domestic product) high payments imbalances. In 1981, access through the supplemental fund was further expanded to provide even larger loans in relation to quotas. The supplemental financing facility, as was true of the oil facilities, was (and continues to be) funded through borrowed resources. A second subsidy account was established to assist lowincome developing nations meet the higher charges associated with loans made through the supplemental financing facility. All of the special financing facilities described above, together with the tranche quota loans, provide the balance of payments loan framework within which the IMF conducts its primary activities in the 1990s (Lewis, 1994, p. C13). Many concepts and criteria have been established to
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Some common words found in the essay are:
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Approximate Word count = 2892
Approximate Pages = 12 (250 words per page)

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