The Role Of The IMF And The World Bank

The point Mr. Woods was making in chapter seven was that both the international monetary fund and the World Bank existence is important for a number of reasons. They are instruments that foster global monetary cooperation and financial stability, they facilitate trade, promote high employment and sustain economic growth while working to reduce poverty and improve people’s lives in poor countries. These institutions advance the mentioned causes through lending practices and conditionality in conjunction with deep research of the developing countries they purport to help. However, the work of the IMF and the World Bank is heavily affected by the most powerful member states, their own motives and lastly by the politics in the borrower countries. …show more content…
First on the list, they cater to the interests of their powerful member countries, and two, economic ideas, fashions and orthodoxies are shaped by the needs and culture of each institution. Consequently, bureaucratic set up of the two institutions have profound differences and practices in the way they operate. For example, World Bank staff is generously rewarded if they lend more money and not less whereas the IMF doesn’t reward its workers for such efforts and yet, member governments in developing, transitioning or emerging economies all borrow from the two institutions. Nonetheless, these institutions have failed to deliver any meaningful development to the developing world because they lack interlocutors in the borrower countries that have the right expertise to get the job done. Other factors including overpriced lending and their conditionality have been driven by political and bureaucratic pressures. The loans from the World Bank serve vested interests in both the rich and the poor countries which make them pursue private profit at the expense of the public …show more content…
Still, change as history has proven over time, is not easy. Certain world views or attitudes will become more acceptable to the people of the world while others will be rejected. For instance, the Bush era was focused on unilateralism while Obama years have leaned toward multilateralism. There is reason for the world and the UN to learn from past history with a recognition that history can be misinterpreted or misused as a guide for settling political objectives. Anytime the UN may want to intervene in a foreign country for whatever purpose, it would be good for it to do a comparison to the historical lessons learned from Iraq, Somalia, and Kosovo among other places that could shed light on how the UN could become effective in using diplomacy to solve world crisis. The UN’s main mission is to promote and maintain international peace and security. Human security which encompasses democracy and human rights and human development which is geared toward guaranteeing fundamental human rights: absence of wars, degrading of values and property