A. To promote economic development.
The International Monetary fund and the World Bank are committed to the purpose of promoting financial co-operation among all nations, and to aid in the growth and development of economically poor nations. They also promote a healthy financial currency exchange, by setting a maximum exchange limit for all world currencies and regulating the rise and fall of values of currencies. The IMF and World Bank also have loan facilities for the governments of economically weaker nations, and these are used in several developmental projects such as industries, health, trade, commerce, and finance. They also promote global trade and commercial exchange by either dissolving customs and tariff barriers among nations willing to undertake economic co-operation, or simply by boosting the economy of weaker nations, thereby bringing them within the ambit of international commercial exchange.
Further Explanation:
The International Monetary Fund rescues a nation from severe economic disasters. It monitors the annual economic growth and fiscal performance of its member nations and helps them in utilizing their fiscal budget through recommendations made by their economic advisers. The IMF has certain basic standards of economic assessment, which has to be taken by all
its member nations, thereby giving them an idea of the status of their economic health. They analyze the fiscal trends of the economies of their member nations and make recommendations for fiscal legislation, which can be integrated within their policies. The loans floated by IMF are only made if the nation is willing to enact on their recommendations, which is also accompanied by high rates of repayment. Thus, we can say that the IMF provides immediate relief to member nations suffering from economic crisis. On the other hand, the World Bank provides economic assistance for long term economic development, such as building infrastructure, industries and integrating them into the global trade networks.
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Answer Details:
Grade: High School
Chapter: The United Nations and its Organizations
Subject: History
Keywords:
Financial co-operation, economic development, commercial exchange, stable currency rate, global trade networks, economic and financial recommendation, fiscal legislation.
