The IMF has about138 members and of this, the developing nations,who constitute100 countries have only 28% of the total voting right, whereas about 10 developed nation has more than 62% voting right. For any nation to qualify for loan, its resources are related to that member country’s monetary reserves, foreign trade and payment patterns. In…
Category: International Economic Institutions
Origin and Development of International Monetary Fund (IMF)
The International Monetary Fund (IMF) came into existence after the first and second world wars, which disorganised the major trading nations of the United Kingdom, United States of America, Germany, Australia and France. As a result of this economic depression, and against this historical experience, however, representatives of Allied nations, which were the Western European…
Conditionalities of the International Monetary Fund (IMF)
Before a country is qualified to obtain loan from the IMF, the following conditions have to be fulfilled which are known as “Conditionalities”. 1. Reduction in grants, subventions and loans to parastatal.2. Reduction in the overall public expenditure especially budget deficit.3. Stoppage of non statutory transfer to state government.4. Upward review of interest rates and…
Effects of International Monetary Fund on the Developing Countries
Problems of Conditionalities Operation of the IMF is bound to have adverse effects on the developing countries from the way its operation are carried out. This is because developing countries have not been able to fulfill the IMF’s requirements such as devaluation of currency, adjustment of producer prices, retrenchment of workers in the civil and…
Functions/Objectives of International Monetary Fund (IMF)
Promotion of Exchange Rate Arrangement among Members It enables different countries to come together to solve the problems of difference in currencies, and to avoid competitive exchange of depreciation of currencies. Acts as a Consultant by Giving Expert Advice to Members It advises member countries on technical and economic matters on how to overcome their…
Conditions Necessary for World Bank Loans
The loan is principally given to companies, corporations and government. To obtain loans from the World Bank is strictly based on the quotas contributed by member countries according to their economic strength or national incomes, as well as the ability to borrow on the international market by issuing of bonds. Therefore, member countries must fulfil…
The International Bank for Reconstruction and Development (IBRD)
The International Bank for Reconstruction and Development (IBRD), otherwise known as the World Bank, was established on the 27th December, 1945 following an agreement reached by 44 nations at Bretton Woods in Washington D.C., U.S.A. The IMF was established to give short term loans to member countries to correct their short term balance of payment…
Functions and Objectives of International Bank for Reconstruction and Development (IBRD)
(i) Provision of Long Term Loans for Development It gives short and long term loans to member countries to enable them carry out development of social amenities and also major capital projects. The rate of interest is very low. Repayment of loan lasts for about five to twenty-five years. (ii) Provision of Assistance for Expansion…
Importance of International Bank for Reconstruction and Development (IBRD) to Developing Countries
Nigeria in particular has benefitted greatly from the World Bank as one of the developing nations of Africa, since it attained independence in 1960. Nigeria collected loans from the World Bank up to ₦58 million after her independence in 1960 to carry out the construction of the power station known as Kainji Dam. In 1970,…
The United Nations Conference on Trade and Development (UNCTAD)
Origin and DevelopmentThe United Nations Conference on Trade and Development (UNCTAD) was established in 1964 as an organ of United Nations Organisation, following the protest called by developing countries requesting the United Nations to convene a meeting to discuss the worsening economic situation of developing countries against the rich nations of the world. The conference…
Functions and Objectives of the United Nations Conference on Trade and Development (UNCTAD)
The main functions and objectives of UNCTAD can be stated as follows: (i) During this conference, the objective was aimed at resolving the issue relating to trade development in poor countries or developing nations.(ii) It is to help solve the difficult problems in the developing countries, for example, in the struggle to reduce the gap…
Importance of United Nations Conference on Trade and Development (UNCTAD) to the Developing Countries
When its basic functions are systematically considered, it would be discovered that the major objectives of UNCTAD conference tend to run short of expectations, based on the numerous problems plaguing the developing nations. The developed nations of the world have not taken steps to implement any of the recommendations made at the conference. For instance,…
African Development Bank (ADB)
African Development Bank (ADB) was established in 1964 following a joint meeting of some African Ministers of Finance with headquarters at Abidjan, Cote d’ Ivoire with 23 African countries as members. The bank is exclusively owned by West African countries which belong to Organisation of African Unity. Both the O.A.U and the EGA contributed immensely…
Functions and Objectives of the African Development Bank (ADB)
1. It helps to finance economic and social projects through the provision of loans which promote economic development of member countries. 2. It provides technical assistance to member countries in the area of conducting feasibility study so as to ensure orderly development and execution of projects. 3. The bank provides assistance in the area of…
The European Economic Community (EEC)
The European Economic Community (EEC) commonly called the European Common Market was founded in 1957 by six member countries. They are, France, Italy, Belgium, Germany, Luxembourg and the Netherlands. Later, in 19?3, Britain, Denmark and the Republic of Ireland joined the organisation. The treaty establishing the EEC was signed in Rome. The agreement provides for…
Functions and Objectives of European Economic Community (EEC)
The economic policy of establishing the EEC was to fulfill the following policies stated below: i) To create a custom union which will look into certain economic policies in order to create a common market.ii) To establish a wider market for goods that would increase production level.iii) To remove tariffs between member countries with the…
Importance of The European Economic Community (EEC) to Developing Nations
Since the inception of EEC, the developing countries have benefitted greatly from its European Development Fund. A great number of trade moves between EEC and developing nations in the international trade which is fast growing. The developing countries have witnessed greater foreign investment as a result of closer ties with the EEC. For instance, an…
The Organisation of Petroleum Exporting Countries (OPEC)
The Organisation of Petroleum Exporting Countries (OPEC) is an international economic organisation formed by some petroleum producing countries of the world, to stabilise and control the world output and price of crude petroleum. The organisation founded in September 1960, has a total membership of 13 countries. The member countries are, Algeria, Gabon, Ecuador, Indonesia, Iraq,…
Functions and Objectives of The Organisation of Petroleum Exporting Countries (OPEC)
The organisation was formed in order to achieve the following functions and objectives: (i) Control of Price of Crude Oil in the World Market:OPEC determines the minimum prices using different means of stabilising and controlling the sales in international oil market for member countries. (ii) To Regulate the Production Level for Member Countries:OPEC determines oil…
Niger Basin Authority
Origin and DevelopmentThe River Niger Commission as it was originally called, came into existence in 1964 following an agreement reached by 13 member countries of Africa. The member countries are: The Republic of Benin, Chad Republic, Guinea, Cote d’Ivoire, Liberia, Mali, Niger, Nigeria, Sierra Leone, Togo, Burkina Faso and Cameroon. In 1980, the name was…
