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The International Monetary Fund (IMF), located in Washington, D. C. , was originated by two daring men Harry Dexter White in the U. S. and John Maynard Keynes in the U. K... After foreign monetary troubles, these men came up with the IMF philosophy.
What is IMF? IMF is currently a group of 182 countries that contributes money to IMF which helps countries out when their currency is in a crisis. These contributions are known as quota subscriptions. First, these quotas bring a conglomerate of monies together for IMF to lend. Secondly, the amount of money a country would give to IMF would determine how much the country could borrow. Thirdly, IMF determines the voting rights of member country.
The IMF lends money to members having trouble meeting financial obligations to other members, but only on condition that they undertake economic reforms. (Driscoll, Internet) IMF can only encourage borrowing countries to use the money responsibly. IMF influences countries to spend their borrowed currency on education and health. Ever since IMF has persuaded countries to spend on Health Care and Education, GDP has risen in 66 countries from 86 - 96. (Gone, Internet) Also members of IMF feel, it s to the countries advantage to reduce export taxes periodically because it will help trade to grow. By trade increasing in countries, this will produce more paying jobs for people, which helps an economy.
When IMF lends money to a country, the country receives the currency of the country it needs it in. America is the top contributor to IMF. Countries could not afford the Dollar, Yen, or Franc because exchange rates are too high for Less Developed Countries (LDC). When countries join the IMF, they are agreeing to override any restrictions on the exchange of their currency
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Research essay sample on Imf Lends Money Countries To Spend Country
