A Critical Overview of the IMF and the World Bank
The World Bank and the International Monetary Fund (IMF) were both created at the Bretton Woods Conference in 1944. The initial impetus for establishing both the World Bank and the IMF was to create a mechanism that was to rebuild Europe after the devastation of World War II (The World Bank Group: Overview, 2001). With 183 member nations, these institutions have played an increasingly significant role in the economic development initiatives undertaken across the globe. The first World Bank loan, in the amount of $250 million went to France in 1947 for post-war construction. Also in 1947, the World Bank was incorporated into the United Nations system and retained its focus on reconstruction while developing a new focus on poverty reduction (The World Bank Group: Overview, 2001).
The IMF officially came into existence on December 27, 1945, when 29 countries signed its Articles of Agreement agreed to at the Bretton Woods Conference. The IMF was created to promote international monetary cooperation, facilitate expansion and balanced growth of trade, promote exchange stability, assist in the establishment of a multilateral system of payments, shorten the duration and lessen the degree of disequilibrium in the international balance of payments of members, and to make its resources temporarily available to members experience such difficulties (The IMF at a glance, 2001).
Together, both agencies are specialized units subsumed into the United Nations and have become increasingly significant economic actors in the global economic order (What is the IMF?, 2001). This report will consider the theoretical orientation of both institutions and provide a critical examination of the IMF and the World Bank and their activities in developing countries. It will also the business and financial sector of such activities, and the demands for reform in the ways in which both the IMF and ...