Topic 6 International Financial Institution.ppt

Topic 6 International Financial Institution.ppt - Topic 6...

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Topic 6: INTERNATIONAL FINANCIAL INSTITUTION Lecture Notes Prepared by: Dr. Martine Oleche University of Nairobi School of Economics 09/11/18 1 Dr. Martine Oleche, School of Economics, University of Nairobi
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6.1 Definition and Meaning of International Financial Institutions (IFIS) International Financial Institutions can refer to any of the following: International Bank for Reconstruction and Development (IBRD). Recognized international economic organizations established primarily to provide adjustments, financing of external imbalances, creating and distributions of liquidity to their members. International development association (IDA) International Finance Corporation etc. IFIs offer loans, grants, and policy reforms mainly in low- income and middle-income countries. 09/11/18 Dr. Martine Oleche, School of Economics, University of Nairobi 2
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Definition Contd… International Financial Institutions or IFIs refers to the IMF, world bank, multilateral development banks, and other international development agencies. They are more responsive to the need of developing countries and ensure that growth opportunities they promote reach the world’s poorest people. The specific mission of each IFI varies, but typically includes elements ranging from poverty reduction, to economic development, to promotion of international trade. 09/11/18 Dr. Martine Oleche, School of Economics, University of Nairobi 3
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6.2 International Monetary Fund(IMF) Following the breakdown, International Gold Standard in the thirties. Countries embarked on policies aimed at increasing their exports and reducing their imports, such as currency depreciation. Foreign exchange and trade controls, currency devaluation, thus generating retaliatory action from other countries. As a result of which led to total international money disorder. In short, this acute commercial rivalry resulted in straining of political relations with one another, which was one of the remote causes of the Second World War. After the Second World War, there was therefore the need for reconstruction and development, thus an international institution was needed for the orderly international monetary cooperation as well as reconstruction. 09/11/18 Dr. Martine Oleche, School of Economics, University of Nairobi 4
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International Monetary Fund(IMF) Contd… Therefore, in July 1944, some leads national of the world met as a conference in Bretton Wood, New Hampshire in the USA and decided to from the twin institutions namely. 6.2.1 International Monetary Fund Formations The United Nations Monetary and Financial Conference held at Breton Woods in USA in July 1944 decided to establish the International Monetary Fund to help the countries to tide their temporary difficulties in their balance of payments and maintain their rates of exchange fairly at stable level.
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  • Fall '18
  • Dr. Martine Oleche
  • United Nations , University of Nairobi, International Monetary Fund, SCHOOL OF ECONOMICS, Dr. Martine Oleche

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