NAME: - ADNAN KAZI

ROLL NO: - 021

CLASS: - S.Y.BMS

YEAR II SEMESTER III

FACULTY: - NIRMAL JOSHI

COLLEGE: - NIRANJANA MAJITHIA COLLEGE OF COMMERCE

UNIVERSITY: - MUMBAI

Economics

International Monetary Fund

International Monetary Fund (IMF) is an international organization
that oversees the global financial system by following the
macroeconomic policies of its member countries, in particular those
with an impact on exchange rates and the balance of payments. It is
an organization formed to stabilize international exchange rates and
facilitate development. It also offers highly leveraged loans mainly to
poorer countries. Its headquarters are located in Washington, D.C.,
USA

International Monetary Fund Organization

as of April 30, 2007
International Monetary and Financial Committee
Board of Governors
Joint IMF-World Bank Development Committee1
Independent Evaluation Office
Managing Director
Deputy Managing Directors
Investment Office-Staff Retirement Plan
Office of Budget & Planning Office of Internal Audit and Inspection Office of Technical
Area
Departments African Department Asia and Pacific Department Regional Office for Asia and the
European Department Offices in Europe
Middle East and Central Asia Department Western Hemisphere Department Functional and Specia
Services Departments Finance Department Fiscal Affairs Department
IMF Institute Joint Africa Institute Joint Vienna Institute Singapore Training Institute

Legal Department Monetary and Capital Markets Department

Strategy, Policy and Review Department Research Department
Statistics Department Information & Liaison External Relations
Department Fund Office United Nations2
Support
Services Human Resources Department Secretary's Department
Technology and General Services Department
1Known formally as the Joint Ministerial Committee of the Boards of Governors of the Bank a
2Attached to the Office of Managing Director.

Introductory Article
The International Monetary Fund is established and shall operate in accordance with the pro

To enable the Fund to conduct its operations and transactions, the Fund shall maintain a Ge
Article I - Purposes
The purposes of the International Monetary Fund are:
To promote international monetary cooperation through a permanent institution which provide
To facilitate the expansion and balanced growth of international trade, and to contribute t
1. To promote exchange stability, to maintain orderly exchange arrangements among members,
2. To assist in the establishment of a multilateral system of payments in respect of curren
3. To give confidence to members by making the general resources of the Fund temporarily av
4. In accordance with the above, to shorten the duration and lessen the degree of disequili

Article III - Quotas and Subscriptions

Section 1. Quotas and payment of subscriptions

Each member shall be assigned a quota expressed in special drawing rights.
The quotas of the members represented at the United Nations Monetary and Financial Conferen
The quotas of other members shall be determined by the Board of Governors. The subscription
Section 2. Adjustment of quotas
(a) The Board of Governors shall at intervals of not more than five years conduct a general
(b) The Fund may at any time propose an increase in the quotas of those members of the Fund
(j) from the Special Disbursement Account to the General Resources Account.
c) An eighty-five percent majority of the total voting power shall be required for any chan
(d) The quota of a member shall not be changed until the member has consented and until pay

Section 4. Substitution of securities for currency

The Fund shall accept from any member, in place of any part of the member's currency in the
This Section shall apply not only to currency subscribed by members but also to any currenc

Operations and Transactions of the Fund

Section 1.
Agencies dealing with the Fund
Each member shall deal with the Fund only through its Treasury, central bank, stabilization

Section 6.
Other purchases and sales of special drawing rights by the Fund
(a) The Fund may accept special drawing rights offered by a participant in exchange for
Section 7.
Repurchase by a member of its currency held by the Fund
(a) A member shall be entitled to repurchase at any time the Fund's holdings of its currenc
(b) A member that has made a purchase under Section 3 of this Article will be expected norm
A member shall repurchase these holdings if, in accordance with policies on repurchase that
(b) A member that has made a purchase under Section 3 of this Article shall repurchase
The Fund may prescribe that repurchase shall be made by a member in installments during the

(d) The Fund, by an eighty-five percent majority of the total voting power, may adopt perio
(e) A member shall repurchase, in accordance with policies that the Fund shall adopt by a s
(f) A decision prescribing that under a policy on the use of the general resources of the F
(d) above shall be shorter than the one in effect under the policy shall apply only to hold
(g) The Fund, on the request of a member, may postpone the date of discharge of a repurchas

(h) The Fund's policies under Section 3(d) of this Article may be supplemented by policies
(i) All repurchases under this Section shall be made with special drawing rights or with th
The Fund shall adopt policies and procedures with regard to the currencies to be used by me
The Fund's holdings of a member's currency that is used in repurchase shall not be increase

Article VIII –
General Obligations of Members

Section 1
Introduction
In addition to the obligations assumed under other articles of this Agreement, each member
Section 2.
Avoidance of restrictions on current payments
(a) Subject to the provisions of Article VII, Section 3(b) and Article XIV, Section 2, no m
(c) Exchange contracts which involve the currency of any member and which are contrary
In addition, members may, by mutual accord, cooperate in measures for the purpose of making

Section 3. Avoidance of discriminatory currency practices

No member shall engage in, or permit any of its fiscal agencies referred to in Article V, S
If such arrangements and practices are engaged in at the date when this Agreement enters in
IMF Helps to Resolve Balance of Payments Difficulties
Balance of payments difficulties can arise—and, in the worst case, build into crises—even i
IMF lending aims to give countries breathing room to implement adjustment policies and refo
These policies will vary depending upon the country's circumstances, including the causes o
A country suffering from capital flight needs to address the problems that led to the loss
Before a member country can receive a loan, the country's authorities and the IMF must agre
They are designed to ensure that the funds will be used to resolve balance of payments prob
In the absence of IMF financing, the adjustment process for the country would be more diffi
IMF financing can facilitate a more gradual and carefully considered adjustment.
IMF loan programs are tailored to the specific circumstances of individual countries. In re
However, the largest amount of funds is provided through Stand-By Arrangements (SBA), whic
Globalization has vastly increased the size of private capital flows relative to official f
In recent years, the IMF has been re-examining its instruments that help prevent and respon

IMF Emergency Assistance: Supporting Recovery from Natural Disasters and Armed Conflicts
The IMF provides emergency assistance to help member countries with urgent balance of payme
When does the IMF provide emergency assistance?
Since 1962, the IMF has provided emergency assistance to member countries afflicted by natu
This assistance is aimed at meeting immediate foreign exchange financing needs arising from
In 1995, the IMF's policy on emergency assistance was expanded to cover countries in post-c
IMF financing can help a country directly and by catalyzing support from other sources, si

How emergency assistance is provided

Emergency assistance loans are usually quick-disbursing and do not involve adherence to per
An IMF member requesting emergency assistance is required to describe the general economic
In addition, a member requesting post-conflict assistance is expected to indicate its inten
Assistance has been typically limited to 25 percent of the member's quota in the IMF, altho
In March 2004, the Executive Board supported a proposal to extend emergency post-conflict a
Emergency assistance loans are subject to the basic rate of charge, and should be repaid wi
In January 2005, the Executive Board agreed to provide a similar subsidization of emergency

PRGF-eligible countries may also request concessional financing under the Exogenous Shocks
Policy advice, covering the full range of macroeconomic policies and supporting structural
In post-conflict cases, technical assistance is also very important for rebuilding the capa
Areas of focus include rebuilding statistical capacity and establishing and reorganizing fi

Countries that have received emergency assistance since 1995

IMF’s provision of financial assistance for natural disaster emergency assistance, and post
Table 1. Emergency Assistance Related to Natural Disasters, Since 1995

Country Year Event Amount (U.S.$ million) % of quota

Bangladesh 1998 Floods 138.2 25.0
Dominican Republic 1998 Hurricane 55.9 25.0
Haiti 1998 Hurricane 21.0 25.0
Honduras 1998 Hurricane 65.6 50.0
St. Kitts and Nevis 1998 Hurricane 2.3 25.0
Turkey 1999 Earthquake 501.0 37.5
Malawi 2002 Food shortage 23.0 25.0
Grenada 2003 Hurricane 4.0 25.0
Grenada 2004 Hurricane 4.4 25.0
Maldives 2005 Tsunami 6.3 50.0
Sri Lanka 2005 Tsunami 158.4 25.0
Bangladesh 2008 Floods 217.7 25.0
Dominica 2008 Hurricane 3.3 25.0

Table 2: Post-Conflict Emergency Assistance, Since 1995

Country Year Amount

(U.S. $ million) % of quota
Sierra Leone 2000 13.3 10.0
Republic of Congo 2000 13.6 12.5
FR of Yugoslavia 2000 151.0 25.0
Burundi 2002 12.7 12.5
Burundi 2003 13.4 12.5
Central African Republic 2004 8.2 10.0
Iraq 2004 435.1 25.0
Haiti 2005 30.3 25.0
Central African Republic 2006 10.2 12.5
Lebanon 2007 76.8 25.0
Côte d Ivoire 2007 62.2 12.5
Côte d Ivoire 2008 66.2 12.5
Guinea Bissau 2008 5.7 25.0
Lebanon 2008 37.6 12.5
Comoros 2008 1.7 12.5
Belize 2009 6.9 25.0

IMF Lending
A core responsibility of the IMF is to provide loans to member countries experiencing balan
When can a country borrow from the IMF?
A member country may request IMF financial assistance if it has a balance of payments need—
The changing nature of IMF lending
The volume of loans provided by the IMF has fluctuated significantly over time. The oil sho

The process of IMF lending

Upon request by a member country, an IMF loan is usually provided under an “arrangement”, w
IMF Facilities
Over the years, the IMF has developed various loan instruments, or facilities, that are tai
Except for the PRGF and the ESF, all facilities are subject to the IMF’s market-related int

Poverty Reduction and Growth Facility (PRGF)

and
Exogenous Shocks Facility (ESF).
PRGF-supported programs for low-income countries are underpinned by comprehensive country-o
Stand-By Arrangements (SBA).
The bulk of Fund assistance is provided through SBAs. The SBA is designed to help countries

Flexible Credit Line (FCL).

The FCL is for countries with very strong fundamentals, policies, and track records of poli
Extended Fund Facility (EFF).
This facility was established in 1974 to help countries address longer-term balance of paym

Emergency assistance.
The IMF provides emergency assistance to countries that have experienced a natural disaster

INDEX
SR NO.
CONTENT
SIGN
1.
Introduction
2.
Organization
3.
Article I
4.
Quotas and Subscriptions
5.
General Obligations of Members
6.
IMF Emergency Assistance
7.
IMF Lending
8.
Poverty Reduction and Growth Facility

PREFACE

International Monetary Fund is an international organization which

has an holistic outlook irrespective of the international importance.
This is been rightly seen from the discussion in this project. The most
important part is that of help to the under developed and developing
Countries of the world in case of emergencies.

The IMF also play an important role in the lending however it has an
very strict rules for it.
The IMF has several articles which covers the details of IMF rules
and regulations. The some of them are discuss here. Each articles
has various section and sub-sections which are described in legal
manner.

The important data’s are also available from IMF. IMF also lays an
very important role to reduce poverty