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THE IMF AND VENEZUELA

This research examines the role of the International Monetary Fund (IMF) in the contemporary period. Additionally, this research reviews the recent Venezuelan experience in that country's dealings with the IMF.

The role of the IMF is examined through a review of the organization's purpose and the contemporary status of the institution. The probable future of the IMF is also considered.

The origins of the IMF may be traced to an international recognition of the debilitating character of such activities, and of the need to establish some sort of mechanism through which international economic stability could be both created and maintained (Heller, 1990, p. 51). Work toward the creation of such a mechanism began during the Second World War, and the IMF was created toward the end of the war, through the Bretton Woods Agreement of 1944. The IMF commenced actual financial operations in early-1947.

The Bretton Woods Agreement actually created two international financial institutions. The first was the IMF, an organization charged with responsibilities to encourage international monetary cooperation and the removal of foreign exchange restrictions, stabilize of currency exchange rates, and facilitate multilateral payments between member countries. The second institution created was The International Bank for Reconstruction and Development, more commonly known as The World Bank (Katz, 1990, p. 2). The World Bank's mandate is to

Initially, member countries of the IMF were required to adhere to an agreed exchange rate regime, in which fluctuations in the international exchange values of currencies were to be confined within a range of + 1.0 percent of the par value of the currencies. The par values of currencies were stated in terms of the United States dollar, which, in turn, was linked to a specified gold value.

The system worked relatively well for about two decades. The weakening value of the United States dollar i...

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THE IMF AND VENEZUELA. (1969, December 31). In LotsofEssays.com. Retrieved 09:08, March 29, 2024, from https://www.lotsofessays.com/viewpaper/1712258.html