IMF Full Form | Full Form of IMF
IMF Full Form - International Monetary Fund
- IMF stands for International monetary fund.
- It a world organization established in 1945 to promote global economic process, monetary cooperation, financial stability, international trade, and to reduce poverty throughout the world.
International Monetary Fund
- IMF is headed by a board of governors, each of whom represents one among the member countries of the organization.
- It headquartered in Washington, D.C., and has around 190 member countries.
- Each member country has its representatives within the IMF's executive board in proportion to its financial importance in order that the countries that have a powerful influence on the worldwide economy could have the most voting power.
- The main objective of the IMF is to make a stable international monetary system; A stable system of exchange rates and international payments to enable countries to transact with one another. It achieves this in three ways:
- Keeps track of the worldwide economies and therefore the economies of member countries.
- Lending to countries facing the balance of payments issues.
- Providing practical help to members.
- Its mandate was updated in 2012 so as to include all issues associated with the macroeconomic and financial sector which have an impression on global stability.
Functions of IMF
Some of the main functions of IMF are as follows:
- It's going to discourage fluctuations within the rate of exchange to take care of exchange stability.
- It helps member countries to reduce the disequilibrium of balance of payments by selling or lending foreign currencies to the members.
- It’s going to advise its members to change the par value of its currencies if there are fundamental changes within the economies of its members.
Determination of Par Value
- It enforces the system of determination of par value of the currencies of the member countries.
- As per the rules of the IMF, the member countries must declare the par value of their currencies in terms of gold and US dollars.
- It gives suggestions to member countries associated with economic and monetary matters to help them stabilize their economies.
Balance the Demand and provide of Currencies
- It's going to declare a currency as scarce currency which is in great demand and may increase its provide by borrowing it from the country concerned or by purchasing it in exchange for gold.
- It allows members to borrow from the IMF in exchange for their own currencies.
- The borrowing countries are required to repurchase their currencies by repaying loans in convertible currencies.
- It provides technical assistance to the member countries.
- It provides the services of its specialists and experts or can send the surface experts to provide technical support to member countries.