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8/19/2019 IMF Full Final Ppt
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IMF – International MonetoryFundMarch 07, 2016
Presented By: (GroupI
!noop "u#ar $har#a(%20!darsh &ha''ed(%11!poora $har#a (%22
)ahul Gupta(%*2$aura+h er#a (
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2
Ideal )ole o/ the Fund
eelop#ent o/ a country reuires an
ino3 o/ priate /orei4n sain4s Ino3 3ould coer a current account
de5cit o/ten caused +y i#port o/ capital4oods
ccasionally, this priate /orei4n sain4sdisappears)esultin4 in a +alance o/ pay#ents
crisis
In these instances IMF steps inMe#+er dra3s on its resere and credittranches
)epayin4 credit tranche de+ts in 5e yearsti#ehus, IMF o8ers short9ter# credit,
steppin4 in to replace priate /orei4nsain s on those rare occasions
8/19/2019 IMF Full Final Ppt
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istory
Great epression o/ the 1;
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he Bretton =oods !4ree#ent(B=!
IMF 3as /or#edthrou4h the
B=!:
B=! 3as conceiedin >uly 1;%% International
Monetary Fund(IMF /or#ale?istence 3as inece#+er 1;%*
Par alue syste#
@nd o/ Bretton=oods syste#
(1;72–A1 :
he syste# dissoled+et3een 1;6A91;7
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IMF Beco#in4 a CniersalInstitution:
he /all o/ the Berlin 3all in 1;A; @?pansion to /ul5ll responsi+ilities $oiet Bloc- ransition e+t relie/ /or poor countries
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IMF is an international 5nancial or4aniDationco#prised o/ 1A< #e#+er countries
he IMF en4a4es in /ollo3in4 actiities:
@cono#ic sureillance or #onitorin4 ispensin4 o/ policy adice Eendin4 echnical assistance @?chan4e rate sta+ility +alance o/ pay#ents diseuili+riu#
4ro3th o/ international trade
he Most I#portant /eature o/ IMF isuota syste#
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!d#inistratie $tructure
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ranche
I/ an IFM #e#+er /aces +alance o/
pay#ents diculties&an auto#atically +orro3 one /ourth o/
its uota in the /or# o/ a resere tranche
=hen the IMF lends to a #e#+er
country, 3hat actually happens isdo#estic country purchases internationalreseres /ro# the IMF usin4 its o3ndo#estic currency reseres
Me#+er country is then o+li4ed to repay IMF+y repurchasin4 its o3n do#estic currencyreseres 3ith international resere assets
IMF lendin4 is -no3n as a Hpurchase9repurchase arran4e#ent
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&redit tranchesri4inally, each 3ere eual to J o/ the
#e#+ersK uotas
In the late 1;70s, credit tranches 3ereincreased to
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IMF Eendin4
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$pecial &redit Facilities
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$uccess Failures
$uccess/ul operationsBailout o/ Me?ico (N;*
Bailout o/ "enya
Bailout o/ BraDil (N;A
Bailout o/ !sia (N;A
Bailout o/ !r4entina (2001
FailuresBailout o/ )ussia (N;A
Bailout o/ Greece (2012
12
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&urrent &hallen4es /or the IMF
&ontinued Glo+aliDation (200*9present IMF should re#ain prepared /or a #ore
unsta+le 3orldra#atic chan4e o/ 3orld econo#y
since the creation o/ the IMF! sharp rise in priate international
capital o3s$peed o/ capital account crises Icelandic Financial &risis
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Future o/ IMF
IMF $ets ut a $trate4y /or Financial$ureillance Identi/y potentially dan4erous
i#+alances in the 4lo+al econo#y earlyon, and encoura4e countries to ta-e
action to reduce those i#+alances$ere as re/eree /or disputes oer
e?chan4e rates&oordinate the proision o/ crisis
liuidity conditioned on necessary policyad'ust#ents 3hen the uncoordinatedactions o/ #ar-et participants results inliuidity runs that could 4ie rise tocostly crises
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han- Oou
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