International Organizations: The International Monetary Fund and United Nations

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            The World Trade Organization or WTO is behind the policies and maneuvers behind international trades between various countries around the world. The WTO prides itself to be the sole organization that operates for this particular purpose. (WTO, a) Due to WTOs singularity in the field, it is the only organization through which nations are able discuss trade rules and policies, settle arguments or disagreements, and heed advice or guidance on any process that has something to do with international trade. Another purpose that the WTO claims to deliver is the liberalization of trade, limited by rules and policies that ensure trade agreements and laws being implemented do not lead to unethical or illegal results. WTO also focuses on other areas of trade, such as the concerns of consumers that need to be addressed or the threats of diseases or illnesses being spread due the actual process of trading. For the strict compliance to trade laws and policies, the WTO acts to greater lengths to ensure that the public, corporations, and governments are aware of these laws and policies for transparency. (WTO, b)

            The International Monetary Fund or IMF is an organization that works with more than one hundred countries across the globe for the purpose securing the stability and development of finances and economies. In addition, the IMF seeks to promote collaboration between nations in the form of desirable international trade relationships and policies as a means to solve various worldwide problems, such as unemployment, economic growth and development, and poverty that might be addressed through the proper management of existing worldwide financial resources. (IMF, a) The IMF seeks to accomplish its goals through its deep involvement in the observation and supervision of economies, the presentation of well-informed suggestions and recommendations to nations about sound financial policies for the purpose of determining and preventing risks and potential threats, the granting of loans to countries in need of financial support, and the IMFs extension of help to countries that need technical assistance for efficient handling of finances and economic positions. (IMF, b)

            Perhaps one of the successes of the IMF was its being able to fulfill one of its goals of helping out nations that are in need of financial support, in this case, Ukraine. Through thorough investigation and supervision of the economy Ukraine, the IMF has found out that the nation’s government was having trouble with its local financial institution. Ukraine has amassed a considerable amount of debt, the country’s inflation rate has escalated, and such, that it is no longer able to contain damages to its economy. IMF, as a valuable and dependable institution in terms of resolving economic and financial problems acted to help Ukraine by approving a Stand-by Agreement with the country. The agreement constitutes a loan surmounting to a little more than $16 billion as a means to assist Ukraine in stabilizing its economy and plunging itself away from further financial crisis and recession. (IMF, c)

            However, despite the great successes of the IMF, it has also made mistakes along the way preventing it from accomplishing its goals and objectives. The organization has admitted openly about the failure of one of the policies that it implemented, that is the policy founded on capital account liberalization which compels various developing nations to become involved in partnerships and negotiations with foreign investors. This was supposed to address one of the primary goals of the IMF to help countries sustain and develop their economies. However, the results of the implementation of the policy backfired. Several countries have allowed the influx of foreign investments to their local markets in exchange of large amounts of loans from the IMF. The downside of this policy was the effect of withdrawals from foreign investors to the host nation’s economies – that is economic recession. In order to address this growing problem, the IMF has appealed to nations to review their markets prior to catering to foreign investors. IMF also added that countries need to build a solid foundation for their local financial bodies in order to secure its position despite the contributions or problems that foreign investments might make. (BBC News)

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Works Cited

BBC News. (2003). “IMF Admits Policy Failures.” Retrieved BBC. 04 Feb 2009.             <http://news.bbc.co.uk/2/hi/business/2863153.stm>

IMF, a. (N.D.) “About the IMF.” Retrieved from International Monetary Fund. 04 Feb 2009.             <http://www.imf.org/external/about.htm>.

IMF, b. (N.D.) “What the IMF Does.” Retrieved from International Monetary Fund  04 Feb     2009. <http://www.imf.org/external/work.htm>.

IMF, c. (2008). “IMF Approves US$16.4 Billion Stand-by Agreement for Ukraine.”      Retrieved from International Monetary Fund. 04 Feb 2009.             <http://www.imf.org/external/np/sec/pr/2008/pr08271.htm>

WTO, a. (N.D.) “What is the WTO?” Retrieved from World Trade Organization. 04 Feb           2009. <http://www.wto.org/english/thewto_e/whatis_e/whatis_e.htm>

WTO, b. (N.D.). “What is the World Trade Organization?” Retrieved from World Trade            Organization. 04 Feb 2009.   <http://www.wto.org/english/thewto_e/whatis_e/tif_e/fact1_e.htm>

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