8.8A Global Organisations Established Post War

• • The International Monetary Fund (IMF), World Bank (WB) and World Trade Organisation (WTO) were established by the WWII allied nations
  • been important in maintaining the dominance of ‘western’ capitalism, global economic management and trade policy namely, free-trade
• World Bank (WB):

  • Founded in 1944
  • Originally, its loans helped rebuild countries devastated by World War II 
  • the WB is not a traditional high street bank, but a global bank owned by member countries (187 countries)
  • two main institutions, the International Bank for Reconstruction and Development and the International Development Association
• World Bank (WB):

  • The bank has over 10,000 employees and over 100 offices around the world
  • late 1960s and 1970s it started lending more money to developing countries (Fund schools, reduce poverty, etc)
  • In the 1980s the World Bank along with the IMF began imposing SAPs (structural adjustment programmes) on many of its borrowers - based on a model of western free markets
  • 1990s it was more interested in helping countries achieve the UN's Millennium Development Goals, which included reducing poverty, improving health and education and ensuring sustainable growth
• International Monetary Fund (IMF)

  • The International Monetary Fund help makes currency exchange between countries easier
  • Member countries of the IMF agree to exchange their currency with other countries
  • The IMF lends money to countries, along with advising about their economic and monetary policies, which helps keep the value of world currencies stable
  • This makes international trade and investment around the world possible 
• Foreign exchange:

  • Before countries can buy goods from another country, money has to be exchanged from a buyer's country into the seller's country's currency - foreign exchange of currency
  • Without a reliable supply of foreign exchange in each country, and without relatively stable exchange rates, world trade would drop drastically
  • IMF works to help member countries ensure that they always have enough foreign exchange to continue to do business with the rest of the world
• World Trade Organisation (WTO)

  • The WTO deals with the global rules of trade between nations
  • The WTO is the only international organisation dealing with the rules of global trade
  • Its main function is to ensure that global trade flows smoothly, predictably and freely as possible
  • The WTO offers a system for international commerce 
  • This means WTO rules become part of a country's domestic legal system
• World Trade Organisation (WTO):

  • The WTO is the most important and powerful international institution ever to have been created
  • WTO can create binding agreements and make sure they are respected and enforced
  • Theoretically, WTO decisions are absolute and every member must abide by its rulings
  • WTO members are authorised by the organisation to enforce its decision by imposing trade sanctions against countries that have breached any of the agreed rules